SYLLABUS - HUMAN RESOURCE MANAGEMENT

Unit I - Personnel Management and Human Resource Management: Definition - Growth

and Evolution of Personnel management - Difference between PM & HR - Human Resource
Management: Definition – Objectives - Importance – Overview of Human Resource
Management functions: Operative and Managerial - Role of Human Resource Manager

Unit II - Human Resource Planning: Definition – Need - Process – Job analysis: Job
Description - Job specification - Job evaluation – Recruitment: Meaning - Sources of
Recruitment (internal and external) - Recent trends in Recruitment - Selection: Meaning and
Steps – Placement and Induction

Unit III - Training and Development: Meaning – Importance - Purpose and Methods –
Training Need Analysis and Training Evaluation – Human Resource Development: Concept -
Need - Interventions - Performance Appraisal: Objectives - Uses and Methods: Traditional and
Modern methods (360 & 720 Degree KRI, KPI) - Balanced Score Card system - Barriers of
Performance Appraisal - Career Planning - Succession planning and Competency Mapping and
development.

Unit IV - Wage and Salary Administration: Concept and Methods – Types of Wages,
Theories – Incentives – Other Benefits. Concepts - profit sharing – performance linked
compensation - payroll software - career development strategies - importance – objectives
principles compensation packages - registers and records - HR Documents - HR audit – HR
research - HR, Social compliance and Social audit.

Unit V - Strategy of quality management: Job change: Promotion: Meaning – Purpose -

Types – Demotion – Transfer - Separation – Strategy of quality management: Six Sigma –
Kaizen – TQM – TPM – QMS - 5S - ISO Systems - ISO Certification Schemes - ISO types:
ISO 9001 – 14001 - ISO/TS 16949 – Preparing an Organization for ISO Certification - Quality
assurance: Mckinesey’s 7s frame work, HR out sourcing – PCMM.
Unit I - Personnel Management and Human Resource Management: Definition - Growth
and Evolution of Personnel management - Difference between PM & HR - Human Resource
Management: Definition – Objectives - Importance – Overview of Human Resource
Management functions: Operative and Managerial - Role of Human Resource Manager.

QUE 1: DEFINITION PERSONNEL MANAGEMENT

Edward Flippo: “Personnel Management is the planning, organizing, directing and controlling of
the procurement, development, compensation, integration, maintenance and separation of human
resources to the end that individual, organizational and social objectives are accomplished.”

QUE 2: GROWTH AND EVOLUTION OF PERSONNEL MANAGEMENT

I Evolution: Prior to the industrial revolution:

You know what personnel management is, but how did it acquire the present state? Well, no
specific record is available as to when and how personnel management emerged exactly. Interest
and concern with the utilization and organization of human resource is found in evidence since
antiquity and may be traced in the philosophic, religious and military writings of both ancient
and medieval times.

 Certain aspects of currently understood concepts and practice of management of human

resources may be seen to have their origins deep; in history.
 For instance, “The minimum wage rate” and the incentive “wage plans” were included in
the Babylonian code of Hammurabi around 1800 B.C.
 Historically the development of personnel management has been evolutionary, being
influenced by various gradual changes in the course of its growth.
 It may be broadly said that personnel management began to appear as people started to
work collectively.
  Before the advent of Industrial Revolution, Distinct types of working relationships
involving the masters (employers) and the employees are labeled variously as “Slavery”
“Serfdom” or “The Guild System.
 “The beginning of early personnel management may be traced to Guild System
 In the initial stages of industrial economy popularly known as “Handicraft Stage” cottage
industries were established which gradually created a separate class of handicraft men or
artisans.
 These craftsmen and their trainees formed associations called “Crafts guilds”, to look
after such aspects as price and wage determination etc.
 The Guild System, may be considered as the beginning of early personnel management
because under this system the classes-the master (employers) the travelling journey men
and the apprentices made a closely knit group which involved: “Selecting, training,
developing, rewarding and maintaining work-force.”

INDUSTRIAL REVOLUTION:
Its impact on growth of Personnel Management: the following changes had been brought about
by the industrial revolution.
 It brought forth extensive use of machinery and mechanical energy resulting in to establishing
of factories employing vast men power.
 The old direct and close employer and employee relationship was disturbed .
 The Place of work because the central work place where people worked under a common roof
rather than in their home.
 The opportunities of employment for unskilled man power was reduced which made training
and development of work force an important economic and social necessity.
 It also brought forth the problems of congestion, insanitation unsatisfactory, working and
living conditions, health and accidents etc.
 All these factors drew considerable attention towards the desirability and importance of
employee welfare.
 Specialization developed to a very great extent of aspect of industrial activity including
personal Management.
Trade Union: it’s influence on Personnel Management:
 The Rise and growth of trade unionism is another major influence on the development of
personnel management.
 The advent of Industrial Revolution and the changes brought about by it led to the
development of trade union.
 Trade unions were formed to project the workmen against unscrupulous employers and to
secure improvement in wages conditions and hours of work, it security employee benefit and
services.
Growth of trade unionism significantly influenced the development.
 Personnel management in certain activities such as the adoption of grievance handling
system, the acceptance of arbitration as a means of resolving conflicts of rights disciplinary
practices, the expansion of employee benefit programmers, the liberalization of holiday and
vacation times, clear definition of job duties.
 Job rights through seniority and the installation of rational and defensible wages structures.
 The social welfare tradition in personnel management as reflected in the emergence of so
called social or welfare secretaries in the United States is an outgrowth of trade unionism.

SCIENTIC MANAGEMENT: Its impact on growth of personal management:

 “Personnel Management” as it is today may be said to originate from the U.S.A. as the child
of scientific management.
 The Scientific Management brought a significant changes in the management philosophy and
methods which took root among the industrialists in the early 1900,s.
 It Signifies a movement started by the early observers of the management process who
wanted to develop systematic planning and more orderly directing organizing and controlling
of work and workmen with increased use of measurement, wherever possible.
 Taylor, Henry Grantt, Frank Gilbreth and Lillion Gilbreth the industrial engineers of that
time were concerned with developing techniques for the maximization of the productivity
goal thought the effective Utilization of human recourses.
 They believe that the contribution of human factor to the attainment of high productivity
levels could be considerably increased through appropriate use of selection, training and
monetary incentives.
 Taylor’s scientific management constituted first real attempt originating from the
management itself to achieve a means of utilizing human resources that would be optimal
from both the company and the individual point of view. This is l reflected in personnel
management of today.

Human relation Movement its impact on personnel management

 A series of famous experiment began at the end of 1920, at the How Thorne plant of the
western Electric Company near Chicago.
 The Experiments were initiated with a view to studying the effects of physical factors such as
lighting and ventilation on workers’ productivity.
 It was found that the rise in production during the experimental period was not due to
physical conditions of work only.
 Productivity was prim ally affected by the emotional state of the employee, his relationship
with other people particularly those with whom he worked and by the amount and kind of
attention he received from his superiors.
 The Hawthorne studies heralded a new movement “Human relation Movement”.
 The basic conclusion of the researchers that sociological and psychological phenomena often
exerted greater influence on the output than physical
 By measurable conditions of work did provide the personnel management with a major
justification for their employee welfare programme.

Behavioral Sciences:-
 Behaviors sciences include economics, anthropology, sociology, psychology, political
science, physiology and psychiatry.
 The behavioral science movement was an outgrowth of human relation studies.
 Some far reaching and persuasive criticism of human relations as it existed came from
eminent scholars and thinkers like Harold j. Leavitt, Donald R.Schoen and J. Whistler.
 Human relations philosophy and practice were subjected to a health reassessment based on
solid foundation of the past rejecting the superficial and extending the beneficial personnel
management has gained a lot-both in theory as well as in practice form the knowledge
accumulated in behavioral science discipline.
INDIAN SCENERIO
 So far we have moved through evolutionary stage of personnel management in western
countries. However you may be tempted to ask if it followed the same pattern in India.
 Unlike west origin of personnel management in Indian can be traced back to 1931 when the
Royal commission on Labour recommended the appointment of labour Officers to deal with
the recruitment of labour and to settle their grievances.
 After Independence the Factories Act, 1948 (Sec49) made it obligatory for an establishment
employing 50 or more workers to employ the prescribed number of welfare officers.
 Under the Mines Act the limit was for 500 or more workers and under the Plantation labour
Act, 1951 it was for 300 or more workers.
 These Act’s also laid down the manner of their appointment, salaries and conditions of
service and duties to the performed by then (that include those concerned with welfare, day
to day personnel administration and industrial relation).
 The growth of trade unionism and the increasing Strength of the labour force on the scene
made personnel administration an important aspect of industrial establishment.
 Personnel Management may be said to be specifically recognized in India in 1951, when a
personnel officer was appointed in a chemical concern in Bombay with regular personal
management functions as we understand then today.
 The personnel management function in India today have come to include the welfare aspect
the Industrial relation as well as the personal aspect or recruitment, selection, promotion,
training and development, wages and salary administration.
 Most of the development of personnel management in India has been due to government
intervention and regulations. In 1931, the Bombay Mill owners Association appointed labour
officers to settle grievances and disputes.
 In Bengal under the directions of the Jute Mills’ Association, similar officers were appointed
for setting up food, shops and promoting sports and welfare activities.
 However, the real effort was made with the enactment of the Bombay Dispute Reconciliation
Act, 1934 which provided for the appointment of Government of labour officers to deal with
labour grievances.
 Subsequently during the world war II, the function of labour officers were further enlarged,
under the impact of social reform movement in the country growing concern for
 improvement in labour administration and the development of modern concept and practice
of management, so as to include to the welfare, personnel and industrial relation activities.
The labour officer became a welfare officer.
 The amended Factories Act, 1948 (Sect49), Mines Act and the Plantation Act, 1951 made
obligatory to appoint welfare officers in the establishment employing 50 or more workers in
the case of factories and 500 or more workers in the case of plantations.
 The model factories rules framed by the central govt.(rule7) prescribed the following duties
and responsibilities of labour officers.
(1) To establish contacts and hold consultation with the factory management and workers.
(2) To bring to the notice of the factory management the grievances of the workers, individual as
well as collective with a view to securing their expeditious redress and to act as a negotiation
officer with the trade unions.
(3) To study and understand the point of views of labour in order to help the factory management
to shape and formulate the labour policies for the workers in a language they can understand.
(4) To watch the industrial relation with a view to using his influence in the event of a dispute
arising between the factory management and workers and to bring about a settlement by
persuasive efforts.
(5) To deal with the wage and employment matter by join consultations with the factory
management and the workers representativebodies.
(6) To exercise a restraining influence over the workers going on illegal strikes and over the
management, declaring illegal lockouts and to help in preventing anti social activities.
(7) To maintain to a neutrals attitude during legal strikes or lockouts and to help in bringing
about a peaceful settlement.
(8) To ensure fulfillment on the part of the factory management, of obligations statutory or
otherwise, concerning the application of provisions of the Factories Act, 1948, the rules made
there under and to establish liaison with the factory Inspectors and the medical services men
concerning medical examinations of the employees health records, supervision of hazardous
jobs, visiting the sick and the convalescents prevention of accident and supervision of the safety
committees, systematic inspection of plants, Safety education investigation, of accidents,
maternity benefit and work’s compensation.
(9) To promote relations between the factory management and workers which will ensure
productive efficiency as well as ameliorations in the working 15 conditions and to help workers
to adjust and adopt themselves to their working environments.
(10) To encourage the formation of works and joint production committees, cooperative societies
and safety first and welfare committees and to supervise their work.
(11) To secure provision of amenities, such as canteen, shelter for rest, crèches, adequate latrine
facilities, drinking water, sickness and benevolent scheme for payment, pension and
superannuation funds, gratuity payment, pension and granting of loans and legal advice to
workers.
(12) To help the factory management in regulating the grant of leave with wages and other legal
privileges and to guide workers in the matter of submission of application for grant of leave for
regulating authorized absence.
(13) To secure welfare provisions such as housing facilities, food stuffs, social and recreational
facilities, sanitation advice, individual personnel problem and education of children.
(14) To Advice the factory management on questions relating to training of new starters,
appendices, supervision and control of notice board and information bulletins to further the
education of workers and to encourage their attendance at Technical Institutes.
(15) To suggest measure which will serve to raise the standard of living of workers and in
general promote their well-being.
 This list of duties stated above is quite comprehensive. The rules framed by the different state
Government follow a similar pattern.
 Many of the state government have also made rules regarding the number of officers to be
employed, method of recruitment terms of service.
 Qualifications and salary scales. In practice the state of welfare officers differs from factory
to factory.
 In some progressive units he is given functions responsibilities and states which generally go
with a Personnel Manager; in many others he has been appointed to meet the statutory
obligations only.
 In 1951 a personnel officers was appointed in a chemical concern in Bombay with regular
personnel functions involving selecting training and development promotion etc. now the
shift in the direction of HRD (Human Resourced Development).
HRD a new dimension: Let us see what is Human Relation Development (HRD) System and
how is it different from the traditional personnel function.
 In the traditional personnel function the concept of development was confined to training.
 The main emphasis in training was on the development of individual skill and capabilities to
training.
 The main emphasis in training was on the development of individual skill and capabilities in
person working in the organization.
 This concept of training does not go beyond a point in increasing effectiveness of
organization attention should also be given to the persons group of employee and his boss.
 Then several groups like committees need to be attended to finally the total member of the
departments and the total member of the organization should be covered for development.
 Their developments would in evolve a climate which is conducive for their effective
developing of a self-renewing mechanism in the organization so that they are able to adjust
them self in developing a relevant process which contribute to their effectiveness.
 Some of the features of HRD are.
1. It is sub system of a larger system (Organization):
2. The main task is to develop is to develop enabling capabilities (probating role) :
3. All managers share the responsibility of Human Resources Management :
It believes that people are motivates by challenges and opportunities for development and
creativity rather than by money.
You should understand that HRD is an effect to reorganize the personnel function with much
more emphasis on people in the organization than given to it by its traditional role.
QUE 3: DIFFERENCE BETWEEN PM & HRM

Dimensions PM HRM
a. Nature of relations Pluralist Unitarist or neo-unitarist
b. Perception of conflict Conflict is institutionalized Conflict is pathological
c. Contract Emphasis on compliance Beyond contract-commitment
d. Role of procedures Rules dominated Culture and values dominated
e. Planning perspective Ad hoc, reactive Integrated, proactive
f. Acceptability of unions Acceptable Not desirable
g. Level of trust Low High
h. Key relation Labour-management Customer
i. Management’s role Transactional Transformational
j. Basis of job design Division of labour Teams
k. Key people PM/IR specialists Line people and general managers
l. Skill acquisition Training & Development Learning organization
m. Reward management Standardized job evaluation Performance related

Personnel Management and Human Resource Management-Differences:

1. Personnel Management (PM) concepts emphasize clearly defined rules, procedure and courses.
These rules and customs govern the actions of the management.
 The relationship between the work force and the management is governed by employment
contracts and collective bargaining. Collective bargaining becomes significant because
employees and management see and treat each other as having divergent interests.

2.In PM, plularism, that is men having different views is respected as a social value and the role
of the union is legitimate.
 On the other hand in HRM, open ended contracts, the terms of which are linked to the
exigencies of business, and conflict is viewed as the result of negative inter-personal relations
rather than structural contradictions.

3. PM does not focus on strategic management. Its main goal is peaceful or good labour
management relations. Its function is mainly reactive.
 On the other hand, HRM is a proactive function. HRM is not only concerned with the present
organizational needs but anticipates future needs and seeks to release the inner potential and
creativity of people.

4. The temple of PM is built on collective agreement between the employees and management.
Employees get standardized rewards based on job evaluation.
 But HRM leads to individualization of collective relations.
 Pay is linked with contribution made by the employee to the relation of organizational
goal.
 HRM seeks to develop the competencies of the employees so as to derive benefit from
this development for the organization, and to integrate individual and organizational
goals.
 Skill formation and developments are recognized as the main hallmarks of HRD.

5. PM is a routine maintenance oriented administrative function;

 HRM places emphasis on a continuous development of people at work.

6. PM is seen as independent function and sub-functions without giving due regard to

organizational strategies and processes.
 But HRM is viewed as a sub-system of the organization. Therefore, it takes into account its
linkages and interfaces with all other parts of the organization.

7. PM takes a narrow view of its scope and objectives. It concentrates mainly on

improving the efficiency of personnel in isolation of the organizations.
 But HRM takes a systems view and attempts not only in making people efficient but also in
creating proper organizational culture.

8. PM emphasizes on economic rewards and traditional design of job simplification for

motivating people for better performance.
 HRM emphasizes on the satisfaction of higher needs of motivating people, autonomous work
group, challenging jobs and creativity.
9. PM considers job satisfaction and morale as cause of improved performance. It works
on the basis that a happy worker is a productive worker.
 The emphasis of HRM is the other way round. It is based on the premise that better
performance itself is a source of satisfaction and high morale.
Personnel Management

 Personnel management focuses more on individualistic where individual interest is more than
group interest.
 The distribution of power in personnel management is centralized, where the top management
has full power and authority in decision-making
 Personnel management emphasizes on transactional Leadership style.
 In personnel management, employee’s contract of employment is clearly written and
employees must observe strictly the agreed employment contract.
 Pay policies in personnel management is based on skills and knowledge required for the
perspective jobs only.

Human Resource Management

 HRM focuses more on Unitarist where the word "uni" refers to one and together.
 HRM the power is decentralized, where the power between top management is shared with
middle and lower management groups and the decisions are taken by all levels of
management.
 HRM believes in transformational leaders.
 HRM does not focus on one time life-long contract where working hours and other terms and
conditions of employment are seen as less rigid.
 HRM encourages organizations to look beyond pay for functional duties. Here, the pay is
designed to encourage continuous job performance.

QUE 4: DEFINITION OF HUMAN RESOURCE MANAGEMENT

Flippo (1984) augured that human resource management is the process of planning, organizing,
directing, development, compensation, integration, motivation and maintenance of human
resource to the end those individual, organizational, and social objectives are accomplished.
QUE 5: OBJECTIVES OF HUMAN RESOURCE MANAGEMENT

 To provide, create, utilize and motivate employees to accomplish organisational goals.

 To secure integration of individuals and groups in securing organisational effectiveness.
 To create opportunities, to provide facilities, necessary motivation to individuals and groups
for their growth with the growth of the organisation by training and development
compensation.
 To provide attractive, equitable, incentives, rewards, benefits, social security measures, to
ensure retention of competent employees.
 To maintain high morale, encourage value system and create environment of trust, mutuality
of interests.
 To provide opportunities for communication expression, participation, appreciation,
recognition and provide fair efficient leadership.
 To create a sense and feeling of belongingness, team spirit and encourage suggestions from
employees.
 To ensure that, there is no threat of unemployment, inequalities, adopting a policy

 To provide training to employees to develop skills, increase productivity and enhance

individual and organizational performance for achieving desired results
 To provide a link between top management and employees
 To arrange and maintain manpower requirements in organization for its smooth functioning
 To develop employee benefit scheme, for improving employee motivation
 To create healthy work environment resulting in employee satisfaction.
 To enhance quality of work life for psychological well being of employees
 To follow ethical practices amongst employees
 To maintain competent work force for organization growth and prosperity

SCOTT, CLOTHIER AND SPRIEGEL (1961) stated the specific objectives of HRM
 To ensure effective utilization of human resources, all other organizational
resources will be efficiently utilized by the human resources.
 To establish and maintain an adequate organizational structure of relationship
among all the members of an organization by dividing of organization tasks into functions,
positions and jobs, and by defining clearly the responsibility, accountability, authority for
each job and its relation with other jobs in the organization.
 To generate maximum development of human resources within the organization by offering
opportunities for advancement to employees through training & education.
 To ensure respect for human beings by providing various services and
welfare facilities to the personnel.
 To ensure reconciliation of individual/group goals with those of the
organization in such a manner that the personnel feel a sense of commitment and loyalty
towards it.
 To identify and satisfy the needs of individuals by offering various monetary and non-
monetary rewards.

BASED ON ARMSTRONG, M. (1991), the objectives of human resource management are

(1) To help the organization reach its goals.
(2) To ensure effective utilization and maximum development of human resources.
(3) To ensure respect for human beings.
(4) To identify and satisfy the needs of individuals.
(5) To ensure reconciliation of individual goals with those of the organization.
(6) To achieve and maintain high morale among employees.
(7) To provide the organization with well-trained and well-motivated employees.
(8) To increase to the fullest the employee’s job satisfaction and self-actualization.
(9) To develop and maintain a quality of work life.
(10) To be ethically and socially responsive to the needs of society.
(11) To develop overall personality of each employee in multidimensional aspect.
(12) To enhance employee’s capabilities to perform the present job.
(13) To equip the employees with precision and clarity in transaction of business.
(14) To inculcate the sense of team spirit, team work and inter-team collaboration
QUE 6: OBJECTIVES OF HUMAN RESOURCE MANAGEMENT CAN BE
CLASSIFIED UNDER FOUR MAJOR CATEGORIES

(INTERNATIONAL NAMAA ASSOCIATION RESEARCH & DEVELOPMENT, 2012)

(1) SOCIETAL OBJECTIVE

 The societal objectives are socially and ethically accountable for the requirements and
difficulties of society.
 HRM may contribute ethically and socially regarding the needs and challenges emerging
in the society.
 If an organization fails to use its resources for society benefits in ethical ways it may lead
to restriction by society.

(2) ORGANIZATIONAL OBJECTIVE

 The main objective of HRM is to achieve organizational goals by bringing organizations

effectiveness.
 It is a means to the end of increasing organizational capability.
 It assists the organization in attaining its primary objectives.
 Simply stated, the organizational objective is at the forefront of organizational strategy,
coordinating and harmonizing organization wide efforts and stressing on the role of
human resource management in contributing towards organizational effectiveness.
 Human resource management is not an end in itself.

(3) FUNCTIONAL OBJECTIVE

 Functional objective of HRM deals with contributions of each department regarding their
need and effectiveness in order to attain organization goal.
 Functional objectives attempt to maintain the department’s contribution at a level suitable
for the organization’s requirements.
 Human resources need to be adjusted to match the organization’s demands.

(4) PERSONAL OBJECTIVE

  HRM also deals with personal objectives of the individuals so that personal and
organizational objectives can be met or order to achieve maximum production and attain
competitive advantage.
 Personal objectives help workers in attaining their personal goals, at least insofar since
these objectives boost the individual’s contribution to the organization.
 Personal objectives of workers should be met if they’re to be maintained, retained &
motivated.
 These personal objectives are important in order to maintain, retain and to motivate
employees. If HRM has not done, employee’s dissatisfaction and poor performance will
result in attrition or low productivity.

 In summary, it can be said that the basically the objectives of human resource
management are drawn from and to contribute to the accomplishment of the
organizational objectives.
 The objectives of human resource management are to meet the needs, aspirations, values
and dignity of individual employees and having due concern for the socio economic
problems of the community and the country.

THE OBJECTIVES OF HRM MAY BE AS FOLLOWS:

(1) To create, utilize and motivated workforce, to accomplish the basic organizational goals.
(2) To establish and maintain sound organizational structure and desirable working relationships
among all the members of the organization.
(3) To secure the integration of individual or groups within the organization by co-ordination of
the individual and group goals with those of the organization.
(4) To create facilities and opportunities for individual or group development so as to match it
with the growth of the organization.
(5) To attain an effective utilization of human resources in the achievement of org goals.
(6) To identify and satisfy individual and group needs by providing adequate and equitable
wages, incentives, employee benefits and social security and measures for challenging work,
prestige, recognition, security, status.
(7) To maintain high employees morale and sound human relations by sustaining and improving
the various conditions and facilities.
(8) To strengthen and appreciate the human assets continuously by providing training and
development programs.
(9) To consider and contribute to the minimization of socio-economic evils such as
unemployment, under-employment, inequalities in the distribution of income and wealth and
to improve the welfare of the society by providing employment opportunities to women and
disadvantaged sections of the society.
(10). To provide an opportunity for expression and voice management.
(11) To provide fair, acceptable and efficient leadership.
(12) To provide facilities and conditions of work and creation of favorable atmosphere for
maintaining stability of employment.

THE OBJECTIVES OF HRM MAY BE AS FOLLOWS:

1. To help the organization reach its goals.
2. To provide a link between top management and employees
3. To create a sense of belongingness, team spirit.
4. To create healthy work environment resulting in employee satisfaction.

5. To follow ethical practices amongst employees

6. To achieve and maintain high morale among employees.
7. To motivated workforce, to accomplish the basic organizational goals
8. To maintain competent work force for organization growth and prosperity

9. To ensure effective utilization and maximum development of human resources.

10. To identify and satisfy the needs of individuals by offering various monetary and non-
monetary rewards.
11. To provide the organization with well-trained and well-motivated employees.
12. To increase to the fullest the employee’s job satisfaction and self-actualization.

13. To enhance employee’s capabilities to perform the present job.

14. To provide training to employees to develop skills, increase productivity.
15. To develop and maintain a quality of work life.
16. To develop employee benefit scheme, for improving employee motivation

QUE 7: IMPORTANCE OF HRM

A) SOCIAL SIGNIFICANCE:

 Proper management of personnel, enhances their dignify by satisfying their social needs.
 It is often said that a happy worker is not only happy in his work place but also at home
and in society also
This it does by
i) maintaining a balance between the jobs available and the jobseekers, according to the
qualifications and needs;
ii) providing suitable and most productive employment, which bring psychological satisfaction;
iii) making maximum utilization of the resource in an effective manner and paying the employee
a reasonable compensation for the contribution made by him;
iv) eliminating waste or improper use of human resource.

B) PROFESSIONAL SIGNIFICANCE:
This aspect involves developing people and providing healthy working environment for effective
utilization of their capabilities.
This it does by
i) maintaining the dignity of the employee as a ‗human-being‘;
ii) providing maximum opportunities for personal development;
iii) providing healthy relationship between different work groups so that work is effectively
performed;
iv) improving the employees skill and capacity;
v) correcting the errors of wrong postings and proper reallocation work.

C) SIGNIFICANCE FOR INDIVIDUAL ENTERPRISE:

It can help the organisation in accomplishing its goals by:
i) creating right attitude among the employees through effective motivation;
ii) utilizing effectively the available human resources; and
iii) securing willing co-operation of the employees for achieving goals of the org and fulfilling
their own social and other psychological needs of recognition, belongingness, esteem and self-
actualization
 Human Resource Management has a place of great importance. According to Peter F.
Drucker (1973) the proper or improper use of the different factors of production depend on
the wishes of the human resources.
Hence, besides other resources human resources need more development.
Human resources can increase cooperation but it needs proper and efficient management to guide
it.
Importance of personnel management is in reality the importance of employee functions of
personnel department which are indispensable to the management activity itself.
Because of the following reasons human resource management holds a place of importance.

(1) It helps management in the preparation adoption and continuing evolution of personnel
programmes and policies.

(2) It supplies skilled workers through scientific selection process.

(3) It ensures maximum benefit out of the expenditure on training and development and
appreciates the human assets.

(4) It prepares workers according to the changing needs of industry and environment.

(5) It motivates workers and upgrades them so as to enable them to accomplish the org goals.

(6) Through innovation and experimentation in the fields of personnel, it helps in reducing casts
and helps in increasing productivity.

(7) It contributes a lot in restoring the industrial harmony and healthy employer employee
relations.

(8) It establishes mechanism for the administration of personnel services that are delegated to the
personnel department.
Human Resource Management is related with effective utilization of human resources.
The importance of HRM can be discussed as:
1. IMPORTANCE CONCERNED WITH INDIVIDUAL ORGANIZATION
Human Resource Management can help an organization to achieve to its objective more
efficiently and effectively in the following ways:
(a) Procurement of required talents through recruitment, selection, placement,
inducting, training, compensation and promotion policies.
(b) Secures co-operation of all employee of the organization for achieving goals.
(c) Proper utilization of human resources for the success of the enterprise.
(d) Ensure a future team of efficient ancompetent workers required for the organization.
2. PROFESSIONAL IMPORTANCE
Professional competency among employees can be achieved through the following ways.
(a) Human resource management provides maximum opportunities to employees for their
personnel development.
(b) Providing healthy relationship among employees
(c) Proper allocation of work among employees.
(d) Providing training facilities for the individual development of employees.
3. SOCIAL IMPORTANCE
HRM is important in social perspective also. It includes the following aspects:
(a) Human resource management enhances the dignity of labour.
(b) Provides suitable job to suitable person and it will help to satisfy the psychological and social
satisfaction of employees.
(c) Helps to provide reasonable compensation to workers, which leads them to have a good
standard of living.
(d) Helps to maintain a balance between jobs and job seekers in terms of numbers, qualification,
aptitude etc.
(e) Takes health and safety measures which ensures physical and mental health of the employees.
4. NATIONAL IMPORTANCE SCHOOL OF DISTANCE EDUCATION
Effective management of human resources will speed up the economic growth of nation. This in
turn leads to better standard of living and more job opportunities.

ORGANIZATIONAL SIGNIFICANCE

i. Effective utilization of human resources to motivate them and to change their attitudes to work
and the organization.
ii. To develop personnel to meet the demands of the work effectively; and
iii. To ensure proper recruitment and to retain the personnel in the organization so that right
people are available.

SOCIAL SIGNIFICANCE

This aspect aims in achieving the need satisfaction of personnel in the organisation.
It is often said that a happy worker is not only happy in his work place but also at home and in
society also.
Hence HRM seeks to achieve the following
1. Maintaining balance between jobs and job-seekers, taking into consideration job requirements,
job seekers’ abilities and aptitudes
2. Providing most productive employment from which socio psychological satisfaction can be
derived.
3. Utilizing human capabilities effectively and matching with government rewards.
4. Eliminating wasteful organizational and individual practices.

PROFESSIONAL SIGNIFICANCE

This aspect involves developing people and providing appropriate environment for effective
utilization of their capabilities and involves the following.
1. Developing people on a continuous basis to meet the challenges of their jobs.
2. Maintaining the dignity of personnel at the work place.
3. Providing proper physical and social environment at the work place to create a congenial
working atmosphere.

QUE 8: OVERVIEW OF HUMAN RESOURCE MANAGEMENT FUNCTIONS

A. Managerial Functions: Planning, Organizing, Directing , Controlling

B. Operative Functions: Procurement functions, Development functions, Motivation &
compensation, Maintenance, Integration, & Separation.

MANAGERIAL FUNCTIONS

1. PLANNING –
• Planning is the determination of plans, strategies, programmes, polices, procedures to
accomplish the desired organisational objectives
• Determine the personnel prog regd recruitment, selection, & training to achieve desired
objectives.
• Two main features of Planning are Reasearch and Forecasting.
• Personnel administration should be able to predict the trends in wages, labor market , union
demands, and other benefits

2. ORGANIZING –
• Structure or framework by which cooperative group of human beings allocates its tasks among
its members.
• Design structure of relationships b/w jobs, personnel and physical factors.
• Organisation consist of authority and responsibility , it is the assignment of specific functions
to designated persons or departments with the authorityto carry the activities and accountability
to the management.

3. DIRECTING –
• Getting people to do work willingly & effectively thro supervision and guidance, motivation &
leadership.
• It is motivating, commanding, actuating
• Directing deals not with the dissemination of orders but also the acceptance of the and
excuetion of these orders of employees

4. CONTROLLING & CORDINATING –

• It deals with the task of blending efforts in order to ensure a successful attainment of
organisational objectives.
• Act of checking , regulating and verifying whether everything occurs in
conformity with the plan.
• Ensure accomplishment of plans correctly- measure performance thro review reports, records
etc

OPERATIVE FUNCTIONS
1. Procurement Function – concerned with procuring & employing people with required
knowledge, skill and aptitude.
2. Development – Increase of skills, knowledge abilities etc
3. Motivation & compensation – inspire people to give best-through incentives & rewards
4. Integration – of goals thro progs, redressal, negotiations.
5. Maintenance – protecting & preserving physical and psychological health of employees
6. Separation

2. The functions performed by the human resource management can broadly be classified into
two categories, viz. (1) managerial functions, and (2) operative functions.

MANAGERIAL FUNCTIONS

PLANNING.
 Planning is a predetermined course of actions.
 It is a process of determinig the organisational goals and formulation of policies and
programmes for achieving them.
 Thus, planning is future oriented concerned with clearly charting out the desired direction of
business activities in future.
 Forecasting is one of the important elements in the planning process. Other functions of
managers depend on planning.

ORGANISING
 Organising is a process by which the structure and allocation of jobs are determined.
 Thus, organising involves giving each subordinate a specific task, coordinating the work
of subordinates, delegating authority to subordinates, establishing channels of authority
and communication, establishing departments and so on

STAFFING
 This is a process by which managers select, train, promote and retire their subordinates.
 This involves deciding what type of people should be hired, recruiting, selecting
employees, training and developing employees, setting performance standard, evaluating
performance, compensating employees, counseling employees.

DIRECTING/LEADING
 Directing is the process of activating group efforts in a desired direction to achieve the goals.
 Getting people to do work effectively thro supervision and guidance, motivation &
leadership.
 It includes activities like getting subordinates to get the job done, maintaining morale,
motivating subordinates etc. for achieving the goals of the organisation.

COORDINATING –
 It deals with the task of blending efforts in order to ensure a successful attainment of
organisational objectives.
 Act of checking , regulating and verifying whether everything occurs in conformity with the
plan.
 Ensure accomplishment of plans correctly- measure performance thro review reports,
records etc

CONTROLLING:
It is the process of setting standards for performance, compares actual performance with the set
standards, and taking corrective actions as needed.

OPERATIVE FUNCTIONS
 The operative, also called, service functions are those which are relevant to specific
department.
 These function vary from department to department depending on the nature of the
department.
 Viewed from this standpoint, the operative functions of HRM relate to ensuring right
people for right jobs at right times.
 These functions include procurement, development, compensation, and maintenance
functions of HRM, A brief description of these follows:

PROCUREMENT:
 It involves procuring the right kind of people in appropriate number to be placed in the
organisation.
 It consists of activities such as manpower planning, recruitment, selection, placement and
induction or orientation of new employees.

DEVELOPMENT:
 This function involves activities meant to improve the knowledge, skills, aptitudes and
values of employees so as to enable them to perform their jobs in a better manner in
future.
  These functions includes training to employees, executive training to develop managers,
organisation development to strike a better fit between organisational climate/culture and
employees.

COMPENSATION:
 Compensation function involves determination of wages and salaries matching with
contribution made by employees to organisational goals.
 In other words, this function ensures fair remuneration for employees in the organisation.
 It consists of activities such as job evaluation, wage and salary administration, bonus,
incentives, etc.

MAINTENANCE:
 It is conecerned with protecting and promoting employees while at work.
 For this purpose, various benefits such as housing, medical, educational transport
facilities, etc. are provided to the employees.
 Several social security measures such as providend fund, pension, gratuity, group
insurance, etc. are also arranged.

3. The main functions of human resource management are classified into two categories:
(a) Managerial Functions and (b) Operative Functions.

(1) MANAGERIAL FUNCTIONS: Following are the managerial functions of HRM

(a) PLANNING :
 The planning function of human resource department pertains to the steps taken in
determining in advance personnel requirements, personnel programmes, policies etc.
 After determining how many and what type of people are required, a personnel manager
has to devise ways and means to motivate them.

(b) ORGANIZATION :
  Under organization, the human resource manager has to organize the operative functions
by designing structure of relationship among jobs, personnel and physical factors in such
a way so as to have maximum contribution towards organizational objectives.
 In this way a personnel manager performs following functions :
(i) preparation of task force; (ii) allocation of work to individuals; (iii) integration of the efforts
of the task force; (d) coordination of work of individual with that of the department.

(c) DIRECTING :
 Directing is concerned with initiation of organized action and stimulating the people to
work. The personnel manager directs the activities of people of the org to get its function
performed properly.
 A personnel manager guides & motivates the staff of the organization to follow the path
laid down in advance.

(d) CONTROLLING :
 It provides basic data for establishing standards, makes job analysis and performance
appraisal, etc.
All these techniques assist in effective control of the qualities, time and efforts of workers.

QUE 9: DEVELOPMENT OF HRM

 Awareness regarding HRM was felt during the industrial revolution around 1850 in Western
Europe and U.S.A. Only during the beginning of 20th century, it was felt in India.
 Since then to the present era, the development of HRM may be classified as follows:

TRADE UNION MOVEMENT ERA

 The conditions of workers in the aftermath of factory system as an outcome of industrial

revolution, were very pathetic. The first world war worsened the situation.
 The Royal Commission of Labour in India in 1911, under the chairmanship of J.H. Whitely,
recommended the abolition of the ‘Jobber’ system and the appointment of labour officers in
 industrial enterprise to perform the recruitment function as well as to settle workers’
grievance.
 Workers also started forming ‘trade unions’. The Trade Union Act, 1926 was passed in India.
 The basic object underlying trade union was to safeguard the worker’s interest and to sort out
their problems such as use of child labour, long hours of work and poor working conditions.
 These unions used strikes, slowdowns, walkouts, picketing, as weapons for the acceptance of
their problems.
 These activities of trade unions gave rise to personnel practices such as collective bargaining,
grievance handling system, arbitration, disciplinary practices, employee benefit programmes
and sound wage structure.

SOCIAL RESPONSIBILITY ERA

 In the beginning of 20th century, some factory owners, employers started showing humanistic
approach towards the workers.
 Robert Owen, a British industrialist, reformer and humanitarian is considered to be the first
to adopt humanistic approach towards workers.
 He viewed that the principal social and economic environments influence the physical,
mental and psychological development of workers.
 Hence he felt that to improve the productivity, it is necessary to improve conditions of
employees by removing them from the adverse environment to a congenial atmosphere with
the availability of satisfactory living and working conditions.
 The philosophy in Owen’s patriatic approach was that workers are just like children and the
owner is just like a father.
 Therefore the owner should take care of the workers, just like a father looks after his children.
Owen himself implemented this philosophy in his cotton mill in Scotland by introducing
facilities such as shower baths, toilets, rest rooms and increased minimum wages and housing
scheme.

SCIENTIFIC MANAGEMENT ERA

The concept of scientific management was introduced by F.W.Taylor in the USA in the early
part of 20th century as an alternative to the prevailing system of management by initiative and
incentive based on his shop floor job experience.

TAYLOR DEVELOPED FOUR PRINCIPLES OF SCIENTIFIC MANAGEMENT

1. Development and use of scientific methods in setting work standards, determining a fair work,
and best way of doing work.
2. Scientific selection and placement of workers best suited to perform the various tasks and
provision of their training and development for maximum efficiency.
3. Clear cut division of work and responsibility between management and workers.
4. Harmonious relationship and close cooperation with workers to achieve performance of work
in accordance with the planned jobs and tasks.

 In the scientific theory, Taylor viewed men and workers as one driven by fear of hunger and
search for profit.
 Accordingly, if economic reward is tied up with the efforts put on the job, the worker will
respond with his maximum physical capability.
 Taylor also developed several techniques to introduce his scientific ideas in management.
 They were
1. Time study – to measure the time taken to each job and each operation and to standardize the
operations of the job.
2. Motion study – to study body movements in workplace and to reduce wasteful motions.
3. Standardization of tools, equipments, machinery and working condition.
4. Incentives – wage plan with differential piece rate for efficient and inefficient workers.

HUMAN RELATIONS ERA

 During the years 1925 to 1935, experts expressed their opinions towards the human
aspects of organisation activities.
 Hugo Munsterberg in his book, “Psychology and Industrial Efficiency”, suggested the
use of psychology in selection, placement, testing and training of employees in an
organisation.
  Elton Mayo and his associates conducted a series of experiments from 1924 to 1932 of
the Hawthorne plant of the Western Electric Company in the USA.
 The main findings of Hawthorne Experiments were as follows:

1. Physical environments at the work place do not have any material impact on the efficiency of
work.
2. Favourable attitudes of workers and psychological needs had a beneficial impact on the
morale and efficiency of workman.
3. Fulfillment of the worker’s social and psychological needs had a beneficial impact on the
morale and efficiency of workmen.
4. Employee groups based on social interactions and common interests exercised a strong
influence on worker’s performance.
5. Workers cannot be motivated solely by economic rewards. More important motivators are job
security, recognition, right to express their opinion on matters related to them.
 The findings have stated that the relationship between the superiors and subordinates should
relate to social and psychological satisfaction of the employees.
 Employee satisfaction is the best means of making the employee productive.

BEHAVIOURAL SCIENCE ERA

1. Individual behaviour is linked with the group behaviour. For example, a person may resist
changing his behaviour as an individual.
But he or she will readily do so if the group to which he or she belongs, decides to change its
behaviour.
2. Informal leadership rather than the formal leadership of manager is more effective in
influencing people to achieve standards of performance.
According to their view, democratic leadership style of the manager is more acceptable to the
subordinates and hence more effective.

3. By nature, people do not dislike work. Most people enjoy work and one is motivated by self
control and self development.
In fact job itself is a source of motivation and satisfaction to employee.
4. Expanding subordinate influence, self-control and self – direction can improve operating
efficiency.

SYSTEMS APPROACH ERA

 A system may be defined as a set of interdependent parts forming an organized unit or entity.
 The system is defined as “an organized and complex whole: an assemblage or combination of
things or parts forming a complex unitary whole”.
 The parts, also known as sub-systems, interact with each other and are subject to change.
 These sub-systems are inter related and inter dependant.
 Three broad sub-systems are
i) Technical sub-system - The formal relationships among the members of an organisation
ii) Social sub – system - Social satisfaction to the members through informal group relations.
iii) Power sub – systems- Exercise of power or influence by individual or group.
The system approach is characterized by the following features:
i. A system is a group of inter – related elements which are separate entities/ units.
ii. All the elements are inter– related in an orderly manner.
iii. There is the need for proper and timely communication to facilitate interaction between the
elements.
iv. The interaction between the elements should lead to achieve some common goal.

At the heart of the systems approach is a Management Information System (MIS) and
communication network for collection, analysis and flow of information to facilitate the function
of planning and control.
Modern thinkers consider HRM as a system that integrates activities with an objective to make
the best use of resources which are always scarce.

CONTINGENCY APPROACH ERA

 Contingency refers to the immediate circumstances.

 Contingency approach believes that there is no one way of managing that works best in
all situations.
 According to this approach, the best way to manage varies with the situation.
 Hence this approach is called as ‘situational approach’.
 There may not be one universal way of managing in all situations.
 A particular approach may yield fruitful results in one situation but may drastically fail in
another situation.
 Therefore managers are to analyse different situations and then use the best approach suitable
in that particular situation.

 Stages of evolution of HRM are explained in detail.

(1) INDUSTRIAL REVOLUTION

 Due to rapid industrialization many labourers were employed in large scale production.
 It was difficult for employers to guide or control labours as a result supervisors were
appointed, who looked after employee problems.
 Employees were exploited and their work was not recognized.
 In due course of time, few measures were taken to protect employees and for their welfare.

(2) Growth of trade union

 Due to the exploitation of workers trade Union started growing for welfare of employees.
 Unions tried to solve employee’s grievance by forcing management to give better wages and
working conditions for employees.
 Strikes, were common as a result their was a need for certain machinery which could settle
down employee grievance.

(3) Scientific management approach

 Fredrick Taylor is considered as the father of scientific management, he mainly worked on
motions required for performing the job and the time needed to complete the task.
 Performance standards were formed for each job, where these standards were based on
scientific data rather than on superior judgment.
 Those workers,whose output was above the standard performance level received additional
incentives.
 As a result, it can be commented that scientific management approach was completely based
on motivation by money.

(4) Human relations approach

 It was developed by Hawthrone where he conducted his studies during 1930s and 1940s and
he tried to shift organizations attention to human relations approach.
 He suggested that employee’s productivity is not only influenced by monetary rewards but it
also depends on sociological and psychological factors.
 He tried to explain that employee satisfaction could lead to higher productivity.

(5) Human resource approach

 This approach considers people as important resource for an organization as people have
emotion and they are not considered as factors of productions.
 Some of the principles of human resources approach are:

– Employees are not machines and they are assets to an organization

– Organizational policies and practices must be according to the requirement of employees and
they should help employees for their growth and development.
– Job and task are main motivation for employees. Individual employee need must be fulfilled to
maintain motivation.
– It is important to create a healthy and supporting work environment to motivate and develop
employees for the organizational development.

 When an employee is considered as asset it improves his motivational level which ultimately
leads to better performance.
 This better performance by employees leads to higher organizational performance and when
the organization reaps benefits due to better performance by employees, it should share some
rewards with employees.
 Employee rewards may be monetary or non-monetary.
 Thus, human resource approach benefit organization and employees both achieve their goals.

QUE 10: ROLE OF HUMAN RESOURCE MANAGER

1. Administrative Roles
 Policy maker - develop personnel policies
 Administrative expert - record keeping, databases, processing benefits/claims, leave, medical
facilities.
 Advisor - to line managers , grievance redressal, conflict resolution, selection & training
 Housekeeper - recruiting, testing, ref check, employee surveys, salary & wage admin
 Counselor - on various personal and professional problems
 Welfare officer - provides & maintains canteens, hospitals, clubs, libraries, transportation,
coop societies.
 Legal consultant - settling disputes, handling disciplinary cases, collective bargaining.

2. Operational Roles
Recruiter, Trainer, developer, motivator, Coordinator, Mediator
3. Strategic Roles
 Change Agent - translate vision statements into meaningful format.
 Strategic partner - training centre, design centre..
a) Personnel Role:
 Advisory
 Manpower Planning
 Training & Development
 Measurement and Assessment of individual and group behaviour.

b) Welfare Role:
 Research in Personnel & Organisational Problems
 Managing services – canteens, transports, etc..
 Group Dynamics – Group counseling, leadership, motivation, etc..

c) Administrative Role:
 Time-keeping
 Salary & Wage Administration
 Maintenance of records.
 Human Engineering – Man-Machine Relationship

d) Fire-fighting Role:
 Grievance Handling
 Settlement of Disputes
 Handling disciplinary actions.
 Collective Bargaining24
 Joint Consultation.

 He performs many other miscellaneous roles in accordance with the needs of a

situation, such as:
 The conscience role is that of a humanitarian who reminds the management of its moral and
ethical obligations to its employees.
 He plays the role of a counselor to whom the employees frequently go for consultation.
 As a mediator, he plays the role of a peacemaker, offering to settle the disputes that may
arise among individuals or groups.
 He acts as a spokesman for or representative of the company.
 He acts as a problem-solver with respect to the issues that involve human resources
management
 He works as a change-agent within the organisation because he is best suited to introduce
and implement major institutional changes.

 HR managers have to perform various roles such as administrative, operational and

strategic.
ADMINISTRATIVE ROLE
It includes policy formulation and execution, housekeeping, records maintenance, welfare
administration, legal compliance etc.

 Policy maker:
The human resource manager assists management in the development of policies related to talent
acquisition and retention, wage and salary administration, welfare activities, personnel records,
working conditions etc.

 Administrative expert:
 The administrative role is deeply oriented to processing and record keeping.
 Maintaining employee files, and HR related databases, processing employee benefit claims,
answering queries regarding leave, transport and medical facilities, submitting required
reports to regulatory agencies are examples of the administrative nature of HR management.
 These activities must be performed competently and successfully to meet changing
requirements of employees, customers and the government.
 Advisor:
 The personnel manager performs functions like advising, suggesting, counselling and
assisting the line managers in discharging their responsibilities relating to grievance
redressal, conflict resolution, employee selection and training.
 Personnel advice includes making reports, communication of guidelines for the
understanding and implementation of policies, providing information about labour laws
etc.

 Housekeeper:
The administrative roles of a personnel manager include recruiting, pre employment testing,
reference checking, employee surveys, time keeping, wage and salary administration, benefits
and pension administration, maintenance of records etc.

 Counsellor:
The personnel manager discusses various problems of the employees relating to work, career,
their supervisors, colleagues, health, family, financial, social, etc. and recommends them on
minimizing and overcoming problems, if any.

 Welfare officer:
 Personnel manager is projected to be the Welfare Officer of the company.
 As a Welfare officer, he provides and maintains canteens, hospitals, creches, educational
institutes, clubs, libraries, conveyance facilities, co-operative credit societies and consumer
stores.
 According to Factories Act, Welfare officers are expected to take care of safety, health and
welfare of employees.

 Legal consultant:
Personnel manager plays a role of grievance handling, settlement of disputes, managing
disciplinary cases, collective bargaining, enabling the process of joint consultation, interpretation
and implementation of various labour laws, contacting lawyers about court cases, filing suits in
labour courts, industrial tribunals, civil courts.
Operational role:
 It looks after the day-to-day operations necessary to meet the needs of employees.
 It includes crucial tasks such as Procurement, development, compensation, amalgamation,
maintenance and separation.
 Procurement: Planning, Recruitment and Selection, orientation and Placement.
 Development: Training, Development, Career planning and counseling.
 Compensation: Wage and Salary determination and management.
 Amalgamation: Amalgamating human resources with organizational resources.
 Maintenance: Sustaining and improving working conditions, retention of employees within
organization.
 Separations: Managing separations caused by resignations, terminations, lay-offs, death,
medical sickness etc.
Strategic role:
 As human resource has turned out to be the key competitive advantage, the human resource
manager plays a more strategic role.
 Here, HR manager takes into account theoverall picture of business’s growth and implements
ways to make a direct contribution to long-term goals.
 Here, HR managers attempt to project future business needs and tries to develop current
employees and programs to meet those needs.
 Improving the employer-employee relationship is the strategic role of a HR manager.
 Human resources managers create personnel strategy and determines the functional processes
necessary to meet organizational goals.

 Workplace Safety:
Creating a free work atmosphere is a strategic role of every human resources manager.
It includes risk management from on-the-job injuries.
Reducing accidents through training employees for proper use of complex machinery.

 Employee Training:
 Human resources managers' plays a strategic role related to employee training and
development and prepares the employees for future positions within the company.
 Succession planning, promotion-from-within policies and performance evaluation are major
roles of human resources manager's.
 Training and development motivate employees and helps to improve employee retention.

 Employee Relations:
 It is believed that strengthening the employer-employee relationship depends solely on the
employee relations areas of the HR department.
 It includes salaries, benefits, safety, training and employee development.
 The strategic role of a human resources manager is to determine, how to identify and solve
workplace issues, as well as how to attract a diverse pool of applicants through efficient
recruitment and selection processes.

Unit II - Human Resource Planning: Definition – Need - Process – Job analysis: Job
Description - Job specification - Job evaluation – Recruitment: Meaning - Sources of
Recruitment (internal and external) - Recent trends in Recruitment - Selection: Meaning and
Steps – Placement and Induction

QUE 1: DEFINITION HUMAN RESOURCE PLANNING

“the process by which management determines how an organization should move from its
current manpower position to its desired manpower position.
Through planning, a management strives to have the right number and right kind of people at the
right places, at the right time, to do things which result in both the organization and individual
receiving the maximum long range benefit.”

COLEMAN DEFINES: “HR planning is the process of determining manpower requirements

and means for meeting those requirements in order to carry out the integrated plan of the
organization.”

According to Terry L. Leap and Michael D. Crino, “ HRP includes estimation of how many
qualified people are necessary to carry out the assigned activities, how many people will be
available and what, if anything, must be done to ensure that personnel supply equals personnel
demand at the appropriate point in the future.”

According Dale S. Beach, “ Human resource planning is a process of determining and assuming
that the organisation will have an adequate number of qualified persons, available at the proper
times, performing jobs which meet the needs of enterprise and which provide satisfaction for the
individuals involved”

GEISLER opines, “HRP is the process- including forecasting, developing and controlling-by
which a firm ensures that it has the right number of people and the right kind of people at the
right places at the right time to do things which result in both the organization and individual
receiving the maximum long range benefit” (or) doing work for which they are economically
most useful.”
According to Vetter, ―HRP is the process by which management determines how the
organization should move from its current man power position to desired manpower position.
Through planning, management strives to have the right time, doing things which result in both
the organization and individual receiving maximum long run benefits‖.

According to Gordon Mc Beath, ―HRP is concerned with two things: Planning of manpower
requirements and Planning of Manpower supplies.

Stainer defines HRP as “Strategy for the acquisition, utilisation, improvement and preservation
of an enterprise’s human resources. It relates to establishing job specifications or the qualitative
requirements of jobs, determining the number of personnel required and developing sources of
manpower”.

QUE 2: NEED OF HRP

The need for human resource planning in organisation is realised for the following reasons:
1. Despite growing unemployment, there has been shortage of human resources with required
skills, qualification and capabilities to carry on works. Hence the need for human resource
planning.
2. Large number of employees who retire, die, leave organisations, or become incapacitated
because of physical or mental ailments, need to be replaced by the new employees. Human
resource planning ensures smooth supply of workers without interruption.
3. Human resource planning is also essential in the face of marked rise in workforce turnover
which is unavoidable and even beneficial. Voluntary quits, discharges, marriages, promotions
and seasonal fluctuations in business are the examples of factors leading to workforce
turnover in organisations. These cause a constant ebb and flow in the work force in many
organisations.
4. Technological changes and globalisation usher in change in the method of products and
distribution of production and services and in management techniques. These changes may
also require a change in the skills of employees, as well as change in the number of employees
required. It is human resource planning that enables organisations to cope with such changes.
5. Human resource planning is also needed in order to meet the needs of expansion and
diversification programmes of an organisation.
6. The need for human resource planning is also felt in order to identify areas of surplus
personnel or areas in which there is shortage of personnel. Then, in case of surplus personnel, it
can be redeployed in other areas of organisation. Conversely, in case of shortage of personnel, it
can be made good by downsizing the work force.

Need for Human Resource Planning

1. To meet the manpower requirement of an organisation and also forecasting the cost of
labour.
2. Expansion of an organisation is the basic indication of the growth of the organisation and
human resource planning is required to keep the production at the highest level & to meet the
increasing demand for the products in the marketplace.
3. Due to technological changes, the management may require skilled labour. Existing
employees are to be provided with training and new employees are to be inducted after
proper training and HRP plays a major role in this scenario.
4. Frequent labour turnover which is of course unavoidable, should be monitored and proper
replacement should be available to keep the high standard of production.
5. Each job may requires specific skills and HRP provides manpower with the required
knowledge, skills and attitude.
6. Unproductive labour and shortage of labour lead to production losses. Both problems are
serious and HRP can overcome these problems.
7. Replacement of personnel: Existing manpower may be affected due to retirement,
resignation, retrenchment etc. and HRP is required to assess the shortages and arrange for
recruitment.
8. To meet department-wise manpower requirements: The organisation as a whole may
have the required number of employees, but there may be surplus/shortage of staff in a
particular department. HRP plays a major role in correcting such imbalances.

QUE 3: PROCESS OF HRP

Process of Human Resource Planning
a) Formulating the objective of the company
b) Analyzing current objectives of human resource or manpower
c) Forecasting manpower needs
d) Estimating the man power or human resource supply
e) Formulating the human resource or manpower plans

HUMAN RESOURCE PLANNING PROCESS: This consists of series of activities as follows:

1. Forecasting
Forecasting of future manpower is an important step.
It could be done in terms of mathematical projection of trends in the economy and developments
in the industry, or of jundgement estimates based upon specific future plans of the company.
2. Inventory
Inventory of the present manpower resources and the degree to which these resources are
employed optimally should be assessed.
3. Anticipating problems
Anticipating manpower problems by projecting present resources into the future and comparing
them with the forecast of the requirements, adequacy both quantitatively and qualitatively should
be estimated.
4. Planning
Planning for recruitment, selection, training, deployment, utilization, transfer, promotion,
development, motivation and compensation to be undertaken for manpower requirement
 An resource planning refers to a process by which companies ensure that they have the
right number and kinds of people at the right place, at the right time; capable of
performing different jobs efficiently.
 Planning the use of human resources is an important function in every organisation.
 A rational estimate to various categories of personnel in the organisation is an important
aspect of human resource planning.
 HRP involves the following steps :

HUMAN RESOURCE PLANNING PROCESS

1. Analysis of Organisational Plans and Objectives :

 Human resource planning is a part of overall plan of organisation.

 Plans concerning technology, production, marketing, finance,expansion and
diversification give an idea about the volume of future work activity.
 Each plan can further be analysed into subplans and detailed programmes.
 It is also necessary to decide the time horizon for which human resource plans are to be
prepared.
 The future organisation structure and job design should be made clear and changes in the
organisation structure should be examined so as to anticipate its manpower requirements.
2. Forecasting Demand for Human Resources :

 Human resource planning starts with the estimation of the number and type of personnel
required at different levels and in different departments.
  The main steps involved in HRP process are

(a) to determine and to identify present and prospective needs of human resource,
(b) to recruit the required number of persons.
(c) to select the right type from the available people.
(d) to hire and place in the positions for which they are qualified,
(e) to provide information to the selected people about the nature of work assigned to them,
(f) to Promote or to transfer as per the needs and the performance of employees,
(g) to denote if the employees are disinterested or their performance is not upto the mark,
(h) to terminate if they are not needed or their performance is below standard and shows no
hopes of improvement.

 It is the most crucial and critical area of HRD. These HRD manager must pay attention to
place right man to the right job through recruitment selection Training and Placement of
employees.
 This calls for the adoption of a systematic procedure to complete recruitment and
selection.

3. Forecasting Supply of Human Resources :

 One of the important areas of human resources planning is to deal with allocation of
persons to different departments depending upon the work-load and requirements of the
departments.
 While allocating manpower to different departments, care has to be taken to consider
appointments based on promotions and transfers.
 Allocation of human resource should be so planned that available manpower is put to full
use to ensure smooth functioning of all departments.

4. Estimating Manpower Gaps :

 Net human resource requirements or manpower gaps can be identified by comparing
demand and supply forecasts.
 Such comparison will reveal either deficit or surplus of human resources in future.
  Deficits suggest the number of persons to be recruited from outside whereas surplus
implies redundant to be redeployed or terminated.
 Similarly, gaps may occur in terms of knowledge, skills and aptitudes.
 Employees deficient in qualifications can be trained whereas employees with higher
skills may be given more enriched jobs.

5. Matching Demand and Supply :

 It is one of the objectives of human resource planning to assess the demand for and supply of
human resources and match both to know shortages and surpluses on both the side in kind
and in number.
 This will enable the human resource department to know overstaffing or understaffing.
 Once the manpower gaps are identified, plans are prepared to bridge these gaps.
 Plans to meet the surplus manpower may be redeployment in other departments and
retrenchment in consultation, with the trade unions.
 People may be persuaded to quit through voluntarily retirement.
 Deficit can be met through recruitment, selection, transfer, promotion, and training plans.
 Realistic plans for the procurement and development of manpower should be made after
considering the macro and micro environment which affect the manpower objectives of the
organisation
QUE 4: JOB ANALYSIS

DEFINITION: Edwin B. Flippo has defined job analysis as the process of studying and
collecting information relating to the operations and responsibilities of a specific job.
The immediate products of this analysis are job descriptions and job specifications”.

Gary Desseler has listed the following STEPS in job analysis:–

(i) Determine the objective of collecting job analysis information for deciding the type of data to
be collected and technique to be adopted.
(ii) Collecting background information: Through organization by charts, process charts etc.
Organization charts show how the job is related o other jobs, title of each position, who reports
to whom and with whom o communicate.
Process charts exhibit flow of work i.e. flows of inputs to and output from the job under study.
(iii) Select representative position: to be analysed since it would be too much time consuming to
analyse since it would be too much time consuming to analyse all the jobs of almost a similar
nature.
(iv) Collect Job analysis information: Regarding job activities required employee behaviours
working conditions and human requirements like traits and abilities needed.
(v) Review: - the information with the participants.
(vi) Develop a job description and a job specification.

PURPOSES of job analysis: Job analysis: Is undertaking primarily for staffing purposes
However, it is put to many other purposes, chief among them being
(1) to determine qualifications required of job holdings,
(2) to establish responsibility accountability and authority of job holders,
(3) to provide guide lines in the process of recruitment and selection,
(4) to design training and development programmes,
(5) to decide wages and salary levels,
(6) to appraise performance for the purpose of transfer or promotion,
(7) to provide base for setting production-n standards,
(8) to judge the merits of grievance relating to assignments and compensation,
(9) to provide clues for work simplification , methods improvement and job satisfaction,
(10) to control case and quality,
(11) to avoid duplication of task etc.

USES: The information- obtained from job analysis is mainly used in the following management
activities:
(l) Recruitment and Selection: Job analysis provides information on the basis of
which it is decided what sort of people are to be recruited.
(2) Compensation: Wages and salaries are basically related to job required skills
Eructation safety hazards etc. This information is made available by job analysis.
(3) Performance Appraisal: Through job analysis standards of performance to be
achieved are laid down.
(4). Training: Jot analysis brings out what sort of skills are required on the basis of which
training and development programmes are designed.

QUE 5. JOB DESCRIPTION

 Job description is prepared on the basis of data collected through job analysis.
 Job description is a functional description of the contents what the job entails.
 It is a narration of the contents of a job.
 It is a description of the activities and duties to be performed in a job, the relationship of the
job with other jobs, the equipment and tools involved, the nature of supervision, working
conditions and hazards of the job and so on.
 All major categories of jobs need to be spelled out in clear and comprehensive manner to
determine the qualifications and skills required to perform a job.
 Thus, job description differentiates one job from the other.
 In sum, job description is a written statement of what a job holder does, how it is done, and
why it is done.
PURPOSES OF JOB DESCRIPTION
Job description is done for fulfilling the following purposes:
 Grading and classification of jobs
 Placement and Orientation of new employees
 Promotions and transfers
 Outlining for career path
 Developing work standards
 Counselling of employees
 Delimitation of authority

The contents of job description are follows

Job title Location Job summary,
Duties Machines,tools, and equipment Materials and forms used,
Working conditions Hazards
QUE 6: JOB SPECIFICATION
 While job description focuses on the job, job specification focuses on the person i.e, the
job holder.
 Job specification is a statement of the minimum levels of qualifications, skills, physical
and other abilities, experience, judgement and attributes required for performing job
effectively.
 In other words, it is a statement of the minimum acceptable qualifications that an
incumbent must possess to perform a given job.
 It sets forth the knowledge, skills and abilities required to do the job effectively.
 Job specification specifies the physical, psychological, personal, social and behavioural
characteristics of the job holders.

USAGES OF JOB SPECIFICATION: The uses of job specification include:

 Personnel planning Performance appraisal
 Hiring Tranining and development
The contents of Job specification are follows

Education Experience Training

Judgement Initiative Physical effort
Physical skills Responsibilities Communication skills,
Emotional characteristics Unusual sensory demands such as sight, smell, hearing.
JOB DESCRIPTION:

 Job description is a written statement of the information derived From job analysis
process in a standard format describing what the job holder actually does and under what
conditions.
 Armstrong has listed the following facts to be included in job descriptions.
(1) Job title of job holder
(2) Job title of person to who job holder reports.
(3) Job title of subordinates.
(4) A brief summary of the overall purpose of the job.
 (5) A short description of each of the main activities or tasks carried out by the job holder
(6) Any further information required to convey the size or flavour of the job resources
controlled, level of responsibility, extent of guidance or supervision received, conditions under
which the job is done etc.

D. Yoder maintains that job Description does not catalogue all duties involved and as such an
employee cannot refuse to refuse b perform any work not included in description.
Job description is an online of the minimum requirements of the job.

JOB SPECIFICATION

 R. W. Mandy has observed that job specification is the statement of the minimum acceptable
human qualities necessary to perform the job.
 It is based on job description and shows what kind of person to recruit and for what qualities
that person should be tested.
 Specifications usually relate to:

(1) Physical characteristics e.g. height, weight, vision etc.

(2) Psychological characteristics such as aptitude, ingenuity, mental alertness, analytical ability
judgement etc.
(3) Personal Traits viz manner, emotional stability, leadership, initiative, adaptability, skill in
dealing with Others etc.
(4) Responsibility i-e. sense of responsibility towards results, process, equipment etc.
(5) Education and Training
(6) Work Experience

QUE 7: JOB EVALUATION:

 Job evaluation is a comparative process of establilshing the value of different jobs in a

hierachical order.
 It allows one to compare jobs by using common criterial to define the relationship of one
job to another.
  This serves as basis for grading different jobs and developing a suitable pay structure for
them.
 It is important to mention that job evaluation cannot be the sole determining factor for
deciding pay structures because job evaluation is about relationships, and not absolutes.
 The techniques used for job evaluation include ranking, job classification, points rating,
etc.

QUE 8: SOURCES OF RECRUITMENT

According to Edwin B. Flippo, "Recruitment is the process of searching for prospective

employees and stimulating them to apply jobs in the organisation".

OBJECTIVES OF RECRUITMENT

1) To attract people in the organization with good skills and experiences that
suits the present and future organizational strategies.
2) To add a fresh blood and new ideas at all levels in the organization
3) To develop an organizational culture that attracts competent people to the company
4) To search a creative people whose skills fit the company’s values
5) To search for talent globally and not just within the company.
OBJECTIVES OF RECRUITMENT

i. To attract people with multi-dimensional skills and experiences that suit the present and future
organizational strategies,
ii. To induct outsiders with a new perspective to lead the company,
iii. To infuse fresh blood at all levels of the organization,
iv. To develop an organizational culture that attracts competent people to the company,
v. To search or head hunt/head pouch people whose skills fit the company’s values,
vi. To devise methodologies for assessing psychological traits,
vii. To seek out non-conventional development grounds of talent,
viii. To search for talent globally and not just within the company,
ix. To design entry pay that competes on quality but not on quantum,
x. To anticipate and find people for positions that does not exist yet.

The various sources of recruitment are classified into two broad categories, namely:
1. Internal sources 2. External sources
Internal sources
Internal sources of recruitment helps searching the applications for the vacant position from
those who are already working in the organization. Internal sources include employee referrals,
present employees, and previous employees.
a. Employee Referrals:
 Employee referral is one of the sources of internal recruitment.
 Here, the employees give reference of their friends or relatives who are eligible for the
required post of the company.
 When the employees give successful referrals, they are paid with monetary incentives
which are called "finders fees".
b. Present Employees:
 Present employees are another internal source of recruitment.
 Promotion and transfer are two good source of recruitment.
 Promotion means shifting of employees to a higher level of position carrying higher
responsibilities, facilities, salaries etc.
 Transfer is the change in job assignment.
 It may be a promotion or demotion or no change in terms of status, responsibilities, etc.
c. Previous Employees:
 By previous employees we mean the retired employees or the employees who left jobs
for some reason etc.
 Some retired employees willing to come back and want to work on part time basis in the
companies.
 The employees, who left the company for other job, might come back for higher salary
package or compensations.
B. External sources:
 External sources of recruitment are the recruitment of potential applicants from outside
the organization.
  The different types of external sources that we are going to discuss are advertisement,
employment exchange, campus recruitment, consultants and erecruiting.
a. Advertisement:
 Advertisement in the newspapers and other periodical magazines is one of the most
important external sources of recruitment.
 The companies who are in search of employees, advertises in the newspaper about the job,
job description, salary, qualification, etc.
b. Employment exchange:
 There is government as well as private employment exchange that provide jobs to the
desiring candidates.
 The main function of the exchange is to notify the vacancies before they are filled.
 The employment seeker get registered themselves with the employment exchanges.
c. Campus recruitment:
 Campus recruitment is the recruitment of the prospective employees by the companies.
 Companies have been using a variety of methods to employ and select personnel to work
for them and campus recruitment is one of the newest methods used by most companies
today.
 In campus recruitment, companies / corporate visit some of the most important technical
and professional institutes, universities, colleges to hire young intelligent and smart
students at source.
 In campus recruitment process, instead of the job seekers approaching employers, the
employers come to the most suitable prospective candidate with a job offer.
d. E-recruiting:
 e-recruitment is also known as online recruitment.
 For e.g. Cisco Systems recruits employees only through e-recruiting.
 E-recruitment has many benefits like the candidate can apply online, reduced cost for
traveling distances, administrative workload decreases etc.

QUE 8: SOURCES OF RECRUITMENT

The different sources of recruitment could be classified into two broad categories,
 i. Internal sources and ii. External sources

INTERNAL SOURCES
The various internal sources are
a) Present employees
b) Employee referrals
c) Former Employees
d) Previous applicants

PRESENT EMPLOYEES
 Promotions and transfers from among the present employees can be a good source of
recruitment.
 Promotion implies upgrading of an employee to a higher position carrying higher status,
pay and responsibilities.

FORMER EMPLOYEES
 Former employees are another source of applicants for vacancies to be filled up in the
organization.
 Retired or retrenched employees may be interested to come back to the company to work on
a part-time basis.
 Some former employees who left the organization for any reason, may again be interested to
come back to work.

EMPLOYEE REFERRALS
The existing employees refer their family members, friends and relatives to the company as
potential candidates for the vacancies to be filled up most effective methods of recruiting people
in the organization because employees refer to those potential candidates who meet the company
requirement by their previous experience.

PREVIOUS APPLICANTS
 Those who applied previously and whose applications though found good was not
selected for one reason or other may be considered at this point of time.
  Unsolicited applications may also be considered.

ADVANTAGES OF INTERNAL SOURCE ARE:

1. Familiarity with their own employees
2. Better use of the talent
3. Economical recruitment
4. Morale booster
5. Gives motivation.

DISADVANTAGES OF INTERNAL SOURCE

1. Limited choice
2. Discourages competition
3. Creates conflicts.

EXTERNAL SOURCES
The different external sources are
i. Employment Exchanges
ii. Advertisements
iii. Employment Agencies
iv. Professional Associations
v. Campus Recruitment
vi. Deputation
vii. Word-of-Month
viii. Raiding.

Employment Exchanges
 After India’s independence, National Employment Service was established to bring
employees and job seekers together.
 In response to it, the Compulsory Notification of Vacancies Act of 1959 (commonly
called Employment Exchange Act) was enacted which became operative in 1960.
  Under S4 of the Act, it is obligatory for all industrial establishments having 25 workers or
more, to notify the nearest employment exchange of vacancies in them, before they are
filled. Employment exchanges are particularly useful in recruiting blue-collar, white
collar and technical workers.
EMPLOYMENT AGENCIES
 In addition to the government agencies, there are a number of private employment
agencies who register candidates for employment and furnish a list of suitable candidates
from their data bank as and when sought by prospective employers.
 The main function of these agencies is to invite applications and short list the suitable
candidates for the organization.
 Of course, the final decision on selection is taken by the representatives of the
organization.
 The representatives of the employment agencies may also sit on the panel for final
selection of the candidates.
ADVERTISEMENT
 Advertisement is perhaps the most widely used method for generating many applications.
 This is because its reach is very high. This method of recruitment can be used for jobs
like clerical, technical and managerial.
 While preparing advertisement, lot of care has to be taken to make it clear and to the
point.
 It must ensure that some self-selection among applicants takes place and only qualified
applicants response to the advertisement.
 Advertisement copy should be prepared very well to answer AIDA.
 That is, advertisement should arrest attention, gain interest, arouse desire and result in
action.

PROFESSIONAL ASSOCIATIONS
 Very often recruitment for certain professional and technical positions is made through
professional associations.
 Institute of Engineers, Indian Medical Association, All India Management Association
etc., provide placement services for their members.
  For this, the professional associations prepare either list of job seekers or publish or
sponsor journals or magazines containing advertisements for their members.
CAMPUS RECRUITMENT
 This is another source of recruitment. This is gaining popularity in India.
The advantages are:
i. Most of the eligible candidates are available at one place.
ii. The interviews are arranged in a short notice.
iii. The teaching faculty can also be consulted.
iv. Gives opportunity to sell the organization to a large students body who would be graduating
subsequently.
DEPUTATION
 Yet another source of recruitment is deputation ie., sending an employee to another
organization for a short duration of two or three years.
 This method of recruitment is in vogue in Government Departments and public sector org.
 This method provides ready expertise and the organization does not have to incur the
initial cost of induction and training.

WORD-OF-MOUTH
 Some organizations in India practice ‘the word-of-mouth’ method of recruitment.
 In this method, the word is passed around the possible vacancies or openings in the
organization.
 Another form of word-of-mouth recruitment is “employee-pinching” ie., the employees
working in another organization are offered on attractive offer by the rival organizations.
 This method is economic, both in terms of time and money.

Merits of External Source

1. A process of selection
2. Availability of talented candidates.
3. Opportunity to select best candidates.
4. Provides healthy competition among job seekers.

DEMERITS
1. Expensive and time consuming
2. Unfamiliarity with the organization
3. Discourages the existing employees and they may feel belittled.

QUE 9: SELECTION
Selection it is the process of picking the suitable candidates from the pool of job applications to
fill various jobs in the organisation.

The main steps in selection procedure are as follows:

1. Receipt of Application
2. Preliminary interview or screening
3. Application Blank or Application Form
4. Employment test
5. Interviewing
6. Reference Check
7. Medical examination
8. Selection
1.Receipt of Applications: in this step the applications are received from the candidates from
the vacant post.
2. Preliminary interview or screening:
 In many organisations, preliminary interview is done in order to choose right candidates.
 The preliminary interview is generally brief and its main aim is to eliminate the unsuitable
candidates.
3. Application Blank or Application Form:
 The candidates who are chosen in the preliminary interview are given with an application
blank or form where the data of the candidate is recorded.
 The application blank is a written record which contains the following information:
a. Identifying information such as name, age, sex, marital status, family background etc
b. Educational information which includes academic career, division obtained in various school
and degree level examination etc
c. Information regarding experience such as details of previous job, job responsibilities,
designations, salaries etc.
d. Information regarding extracurricular activities, hobbies etc.
4. Employment test:
 The employment test is used to measure the qualities and abilities of the prospective
candidates.
 This test is used to draw conclusions about the future behaviour or performance of the
candidate.
 The following are some of the employment tests which are used as a selection tool:
a. Intelligence test
b. Personality test
c. Aptitude test
5. Interviewing:
 After clearing the employment test, the candidates now have to face the next step in selection
procedure.
 For selection of deserved candidate, interview is very important.
 The main objective of interviewing is
i) to measure the applicant against the specific requirement of the job
ii) to find out the suitability of the candidate
iii) to seek more information about the candidate.
6. Reference Check:
 Before the final selection, reference check is done of the prospective candidate.
 The candidate is asked to give the name and address of the former employer and also of
two or three persons known to the candidate but not related to him.
7. Medical examination:
 After clearing the above step, the candidate is asked to go for medical examination.
 Medical examination is very important because a person with an ill health cannot do his
responsibilities efficiently and the money invested by the company on him will go waste.
 So, the medical examination is very important.
8. Selection:
 when a candidate overcomes all the above steps of selection procedure, he is then declared
selected.
 The candidate is given with an appointment letter mentioning the terns of employment,
salary, incentives, designation etc.

Selection process
Following are the steps involved in a standard selection process:
1. Preliminary Interview
2. Application Blank
3. Selection Tests
4. Selection Interview
5. Reference checks
6. Physical Examination
7. Final selection

Preliminary interview
 After screening the applications, preliminary interview will be conducted.
 The purpose of preliminary interview is to eliminate unsuitable or unqualified candidates
from the selection process.
 In screening unqualified candidates are eliminated on the basis of information given in
the application form, whereas preliminary interview rejects misfits for reasons, which did
not appear in the application forms.
Application Blanks
 This is a method for getting information from a prospective candidate.
 This serves as a personal record of the candidate bearing personal history profile, detailed
personal activities, skills and accomplishments. Almost all organizations require job
seekers to fill up the application.
 Usual contents are as follows:
i. Biographical information – Age, father’s name, sex, nationality, height, marital status.
ii. Educational information - Name of the institutions where the candidate studied – marks –
Divisions – Distinctions.
iii. Work Experience – previous experience – nature of job – salary – duration – reason for
quitting.
iv. Salary – last salary drawn – minimum salary acceptable.
v. Extra-curricular information – NSS – NCC – hobbies etc.
vi. References – Name and address.

Selection Tests
 Individuals differ in many respects including job related abilities and skills.
 In order to select a right person for the job, individual differences in abilities and skills to
be adequately and accurately measured for comparison.
 According to Lee J. Groobach, “A test is a systematic procedure for comparing the
behaviour of two or more persons.”
 Milton M. Blum defines test as “a sample of an aspect of individual’s behaviour,
performance and attitude.”
 In simple words, test is a systematic procedure for sampling human behaviour.
 Tests may be for psychological testing and for testing specific abilities and skills.
 Psychological tests may be conducted for various purposes:
i. Guiding and counseling
ii. Career guidance
iii. Research on human behaviour and personality
iv. Employment selection for placement
v. For appraising employees promotional potentials
vi. For counseling to perform better in their jobs.

 Types of tests Broadly there are two types of tests viz.,

1) Ability tests and 2) Personality tests.

1. Ability tests
Aptitude test
  Aptitude tests measure ability and skills of the candidate.
 These tests measure and indicate how well a person would be able to perform after
training.
 Thus aptitude tests are used to predict the future ability.
 There are two objectives of the aptitude tests.
 One to advice youth or job seekers regarding the field where they are likely to succeed.
 This is called ‘vocational guidance.’
 Second to select best persons for jobs where they may succeed.
 This is called ‘vocational selection.’
 There are specific aptitude tests for mechanical aptitude test, clerical aptitude test,
management aptitude test etc.,
Achievement test
 Achievement test measures the person’s potential in a given area or job.
 In other words, these tests measure what a person can do based on skill or knowledge
already acquired.
Intelligence test
 Intelligence tests measure general ability for intellectual performance.
 The core concept underlying the intelligence test is mental age.
 It is presumed that with physical age, intelligence also grows.
 There may be exceptions to this rule.
 If a five year old child does the test for six years or above, his or her mental age would be
determined accordingly.
 Mental age is generally indexed in terms of Intelligence Quotient (IQ) and calculate using
the following formula:
IQ = Mental age / Actual age  100
 It means that IQ is a ratio of mental age to actual age multiplied by 100.
 IQ levels may vary because of culture and exposure.
 Intelligence testing in industry is based on the assumption that if organization can get
bright, alert employees quick at learning, it can train them faster than those who are less
endowed.
Judgment test
These tests are designed to know the ability to apply knowledge in solving a problem.

2. Personality tests

Interest tests
 These tests discover a person’s area of interest and to find the kind of work that would
satisfy him.
 The most widely used interest test is Kuder Reference Record.
 It consists of three forms.
 The first form measures vocational interest such as mechanical, computational, artistic,
literary, music and clerical interest.
 The second form measures vocational interest such as group activities, avoiding conflicts
etc.
 The third form of interest measures preference to particular occupations such as
accountants, salesman, managerial position etc.

Personality tests
 These tests are also known as ‘personality inventories.’
 These tests are designed to measure the dimensions of personality ie., personality traits
such as interpersonal competence, dominance, submission, extroversions – introversions,
self-confidence, ability to lead and ambition.
Projective tests
 These tests are based on pictures or incomplete items.
 The candidate is asked to narrate or project his own interpretation on these.
 The way in which the candidate responds, reflects his or her own values, motives, attitude,
apprehensions, personality etc.
 These tests are called projective because they induce the candidate to put himself or
herself into the situation to project the test situation.
Attitude tests
  These tests are designed to know the candidate’s tendencies towards favouring or
otherwise to people, situations, actions and a host of such other things.
 Test of social responsibility, authoritarianism, study of values, employees morale are the
well-known examples of attitude tests.

Advantages of testing: The merits of testing for selection are many.

i. Such tests predict future performance of personnel and for transfer, promotion etc.
ii. It is a method of diagnoses of the situation and behaviour.
iii. Cost effective - as test administered to a group saves time and cost.
iv. Uncovers qualifications and talents, which cannot be detected from application blanks and
interviews.
v. Tests serve as unbiased tools of selection process.
vi. Tests being quantifiable, yield themselves to scientific and statistical analysis.
Developing test programme The main steps are
a) Deciding the objectives – The objectives of the test programme may be hiring, promoting and
counseling of people.
b) Analyzing jobs – Jobs are duly analysed to identify as to which human traits and skills are
necessary for the job.
c) Choosing tests to measure characteristics – reliability, validity, ease of administration, cost
involved are important criteria in the choice.
d) Administration of tests.
e) Test results and evaluation.

Selection Interview
 The next step in the selection process is ‘employment interview.’
 Interview is the widely used selection method.
 It is a face-to-face interaction between interviewer and the interviewee.
 If handled properly, it can be a powerful technique in having accurate information of the
interview otherwise not available.
Objectives of Interview
1. Verifies the information obtained through application form and tests.
2. Helps to obtain additional information from the applicant otherwise not available.
3. Gives the candidate necessary facts and information about the job and the organization.
4. Helps to establish mutual understanding between the company and the candidate and build the
company’s image.

Types of interview: Four types of interview for selection have been identified. They are:
1. Preliminary interview
 This process would be initiated to screen the applicants to decide whether further
detailed interview will be required.
 The candidate is given freedom by giving job details during the interview to decide
whether the job will suit him.
 This method saves time and money for the company.

2. Patterned interview
 In this type of interview, the pattern of the interview is decided in advance.
 What kind of information is to be sought or given, how the interview is to be conducted
and how much time is to be allotted, all these are worked in advance.
 In case the interviewer drifts he or she is swiftly guided back to structural questions.
 Such interviews are also called as standardized interviews.
3. Depth interview
 Under this method, the interview tries to portray the interview in depth and detail.
 Accordingly the life history of the applicant along with his or her work experience,
academic qualifications, health, attitude, interest and hobbies are all analysed.
4. Stress interview
 Such interviews are conducted for the jobs which are to be performed under stressful
conditions.
 The objective of stress interview is to make deliberate attempts to create stressful or
strained conditions for the interview to observe how the applicant behaves under stressful
conditions.
  The common methods used to induce stress include frequency interruptions, keeping
silent for an extended period of time, asking too many questions at a time, making
derogatory remarks about the candidate, accusing him that he is lying and so on.
 The purpose is to observe how the candidate behaves under the successful conditions –
whether he looses his temper, gets confused or frightened.
Reference checks
 In the selection process, the next step is verifying information or obtaining additional
information through reference.
 The applicant is asked to give the names of one or two referees who know him personally.
 Previous employers, University Professors, neighbours and friends are usually referees.
 However, references are treated as a mere formality and are hardly used to influence the
selection decisions.
Physical examination
 The last tool used in the selection process is physical examination.
 The main purpose of conducting physical or medical examination is to have proper
matching of job requirement with the physical ability of the candidate.
 Among various objectives of physical test, the major ones are, to detect if the individual
is carrying any infectious diseases, to identify health defects of an individual undertaking
certain works determined to his or her health and to protect companies from employees
filing compensation claim for injuries and accidents caused by pre-existing ailments.
Final selection
 Final selection follows the above procedures outlined.
 Selected candidates would be sent with appointment orders.
 Additional names than required vacancies may be kept in the waiting list.

QUE 10: PLACEMENT

 Placement involves assigning a specific job to each one of the selected candidates.
 However, placement is not simple as it looks.
 It involves striking a fit between the requirements of a job and the qualifications of a
candidate.
 Pigors and Myers has defined placement as, “the determination of the job to which an
accepted candidate is to be assigned, and his assignment to that job.
 It is a matching of what the supervisor has reason to think he can do with the job
demands and what he offers in the form of pay rolls, companionship” with others,
promotional possibilities etc.
 The importance of placement is that it reduces employees turnover, absenteeism,
accidents and dissatisfactions.

 Placement is understood as assigning jobs to the selected candidates.

 Assigning jobs to employees may involve a new job or different job.
 Thus, placement may include initial assignment of job to new employee, on transfer,
promotion or demotion of the present employees.
 In this section, placement refers to the assignment of jobs to new employees only.

 Placement arising out of transfers, promotions, and demotions are discussed here.
 Placement involves assigning a specific job to each one of the selected candidates.
 However, placement is not so simple as it looks.
 Instead, it involves striking a fit between the requirements of a job and the qualifications
of a candidate.
 Pigors and Myershave defined placement as “the determination of the job to which an
accepted candidate is to be assigned, and his assignment to that job.
 It is a matching of what the supervisor has reason to think he can do with the job
demands (job requirements), and what he offers in the form of pay rolls, companionship
with others, promotional possibilities, etc.”.
 The importance of placement lies in the fact that a proper placement of employees
reduces employees turnover, absenteeism, accidents and dissatisfaction, on the one hand,
and improves their morale, on the other.
 It has been customary in most of the organisations to put employees intially on a
probation period with a view to adjudge their suitability for the job in the organisation.
  The probation period may vary from organisation to organisation ranging from one to
two years.
 Having found the employees’ performance satisfactory during the probation period, their
jobs are regularised.

QUE 11: INDUCTION

 Induction is introducing the new employee to work surrounding and people already
working there.
 In other words, induction is the process of receiving and welcoming an employee when
he first joins a company, and giving him basic information he needs to settle down
quickly and happily and start work.
 According to R.P. Billimoria, “induction is a technique by which a new employee is
rehabilitated into the changed surroundings and introduced to the practices, policies and
purposes of the organizations.”

Objectives of induction
1. To reduce the initial anxiety which all new entrants feel, when they join a new job in a new
organization.
2. To familiarize the new employees with the job, people, work-place, work environment and the
organization.
3. To facilitate outsider – insider transition in an integrated manner.
4. To reduce the cultural shock faced in the new organization and
5. To reduce exploitation by the unscrupulous co-workers.
Format induction
 Formal induction is a planned programme carried out to integrate the new entrant into the
organization.
 Following are the contents in a formal induction programme:
1. Brief history of the organization.
2. Organizational mission, vision, objectives and philosophies.
3. Policies and procedures of the organization.
4. Rules and regulations of the organization.
5. Organization structure and authority relationship.
6. Terms and conditions of the job including remuneration, working hours, holidays, promotional
avenues etc.
7. Welfare measures like subsidized canteen, transport and recreation facilities.
8. Safety measures.

Information induction
 In this system, the immediate job supervisor conducts the induction programme for the
new entrant.
 He briefs the new corner about the job, the department, routine and introduces to the
colleagues, and various sections.

Making induction programme successful

 First impression is the best impression.
 The new employee should feel happy and proud about his company.
 This will create a lasting association and commitment.
 Effective induction needs.
1. Good reception when receiving the new employee.
2. Finding the needs and doubts of new employee.
3. Proper and good presentation about the company and work culture.
4. Induction training by the right instructor.
5. Proper evaluation and follow-up measures.

INDUCTION: CONCEPT OF INDUCTION

 Introduction of a new entrant into any existing group of people has been a common
feature we come across in our every day life.
 Recall, the bride on joining to your family was introduced to your family members and
manners.
 Remember your own joining to your present Department of Business Administration.
 On joining the Department, you may have been told about the Department’s rules and
regulations, the procedure for academic activities such as sessional tests, assignments,
 seminar presentations, summer training, semester examination, papers to be taught with
the names of the teachers, etc.
 You were probably introduced to your seniors by organising ‘freshers welcome’.
 Similarly, when a person joins a new job, he/she also needs the same type of introduction
to his/her job and the organisation.
 This introduction is called ‘induction’. Induction is also known as ‘orientation’ and
‘indoctrination’.
 A new entrant joins an organisation as a stranger to his co-workers, job and organisation.
 This causes the initial anxiety for the new entrant.
 It culminates at times to surprise resignation by the new employee.
 Hence, arrangements need to be made to make the integration of the new employee into
the organisation as smooth and as free of anxiety as possible.
 Induction helps do so.
 Induction is welcoming a new employee to the organisation.
 In other words, it is a well orchestrated event to socialise the new entrant with the people
and the work environment in a particular organisation

According to Michael Armstrong, “Induction is the process of receiving and welcoming an

employee when he first joins a company and giving him basic information he needs to settle
down quickly and happily and start work”.

R.P. Billimoria defined induction as “a tehnique by which a new employee is rehabilitated into
the changed surroundings and introduced to the practices, policies and purposes of the org”
In short, induction is, therefore, the process of welcoming, indoctrination and socialisation of
new employee to his/her job and organisation.

OBJETIVES OF INDUCTION
 When a new entrant joins an organisation, he/she is an utter stranger to the co-workers,
workplace and work environment.
 As such, he/she may feel insecure, shy and nervous.
 The first few days may be all anxious and disturbing ones for the new entrant.
  Particularly when a new entrant comes from rural area, he/she finds himself/herself
completely at sea in an industrial town and city.
 Then, induction helps reduce such anxities and dispels doubts and nervousness from the
mind of the new entrant.

Therefore, an induction programme is designed to achieve the following objectives:

1. To reduce the initial anxiety all new entrants feel when they join a new job in a new org.
2. To familiarize the new employees with the job, people, work-place, work environment and the
organisation
3. To facilitate outsider - insider transition in an integrated manner.
4. To reduce exploitation by the unscrupulous co-workers.
5. To reduce the cultural shock faced in the new organisation.

BENEFITS OF INDUCTION PROGRAMME

A formal induction programme may provide the following benefits to the new comer and the
organsation:Placement, Induction and Socialisation
1. A well-designed induction programme reduces anxiety, nervousness, absenteeism and
employee turnover.
2. Induction helps minimize the reality or cultural shock new employees undergo on joining a
new organisation.
3. Effective induction also helps integrate the new employees into the organisation and fosters
the feeling of belongingness to the new organisation.
4. Induction also binds the newcomer and the present employees in a team.
B.P. Billimoria has appreciated the benefits of induction in these words:
 “Induction has a greater significance in a developing country like India, where the
percentage of illiteracy is very high.
 The worker finds himself completely at sea when by force of circumstances he has to
shift from rural surroundings into an industrial environment.
 It is no use trying to push a handbook of certified rules and regulations into his hands and
expecting him to turn out into a loyal and efficient employee.
  He needs a short and simple induction conducted by some one who speaks his own
language.
 This will go a long way in reducing turnover and, above all, in preventing a worker from
the likelihood of falling a prey to subversive elements which thrive on creating labour
unrest by misrepresenting employees to illiterate employees”.

CONTENTS OF INDUCTION PROGRAMME

The induction programme may be informal or formal. These are discussed one by one.

INFORMAL INDUCTION.
 This is an unplanned induction programme.
 This may be simply an introduction to the new entrant about the job and organisation.
 Such type of induction programme is generally carried out by the medium and small-
scale units.
 Usually, informal induction programme needs to be brief – lasting for one hour or so.
 Informal induction programme itself may be in the following two versions:
(i) Supervisory System.
 In this system, the immediate job supervisor conducts the induction programme for the
new entrant.
 The supervisor briefs the new comer about the job, the department, introduces to the
colleagues, and takes him round the sections/divisions which are related to his job.
(ii) Buddy or Sponsor System.
 In the ‘Buddy System’ the immediate supervisor assigns the responsibility of induction of
the new entrant to an old employee.
 The old employee acts as friend, philosopher and guide to the new comer.
 In order to introduce the new comer to the job and the organisation, the guide, i.e., the old
employee arranges meetings with other persons and departments and also supplies him
with relevant documents/literature regarding rules, regulations and other details of the
organisation.
Formal Induction
  Formal induction is a planned programme carried out to integrate the new entrant into the
organisation.
 This is usually carried out by the large size organisation.
 A comprehensive induction programme is carefully designed to introduce the new entrant
to all about his job, colleagues and organisation. Accordingly, the contents of the formal
induction programme cover the aspects ranging from the mission, vision, rules and
regulations of the organisation to job related particulars like salary, benefits, service
conditions, safety and welfare measures, etc.
 A formal induction programme, thus, includes the following contents:

1. Brief history of the organisation.

2. Organisational mission, vision, objectives and philosophies.
3. Policies and procedures of the organisation.
4. Rules and regulation of the organisation.90 Human Resource Management
5. Organisational structure and authority relationship.
6. Terms and conditions of job including remuneration, working hours, holidays, promotional
avenues, etc.
7. Welfare measures like subsidised canteen, transport, health and recreation facilities, etc.
8. Safety measures.

All the contents of the induction programme are arranged into the three phases which are dis
cussed subsequently.
 Formal induction programme is carried out by the HR specialists through leaflets,
lectures, seminars and conduct tours for a couple of days/weeks.
 The induction may spread over periods of time ranging from a few days to a few weeks
even months.
PHASES OF INDUCTION PROGRAMME
A carefully designed induction programme consists of the following three phases:
1. General Induction
2. Specific Induction
3. Follow-up Induction
GENERAL INDUCTION:
 This first phase of induction is conducted by the HR department.
 The focus of the induction is to expose the new entrant to the organisation by explaining
him the mission, objectives, history and philosophy of the organisation.
 The new employee is also briefed about his service conditions, pay and perks, promotion
procudure, personnel policies and grievance handling mechanism practised in the
organiosation.
 This phase of induction inculcates pride for the employee to work in the organisation.
 The period of induction, depending on the organisation, may vary from a few days to few
weeks.
SPECIFIC INDUCTION:
 This induction is given by the new employee’s supervisor.
 The focus is on the overall exposition of the new employee to his job.
 Accordingly, the employee is introduced to the job, shown place of work and around the
premises, introduced to his co-workers and briefed about the procedures and methods,
custom and routines, rules and regulations regarding his job.
 This training/ induction helps the new employee adjust with his work environment.
 The induction may last for few weeks or even months.


FOLLOW-UP INDUCTION:
 The main objective of the follow-up induction is to verify whether the new employee is
getting himself adjusted with the work and organisation or not.
 This induction is given by the employee’s supervisor or a qualified specialist on
industrial psychology.
 While giving induction training, the employee’s suggestions on adequacy or otherwise of
the already conducted induction programmes and on any other related aspects, if any, are
duly taken into consideration to make the induction more and more effective.
  Such feedback can also be used to assess the requirements of guidance and counselling
for the new entrants.
 The duration of follow-up induction may vary from some weeks to few months.

HOW TO MAKE AN INDUCTION PROGRAMME EFFECTIVE?

 Giving induction to the new employees is essential but is not so simple.

 Only carefully designed and implemented induction programmes are observed effective.
 Following are some of the requisites of an effective induction programme:
1. Receiving New Employees:
 The new employees need to be duly received by the organisation.
 This inculcates a feeling in the new entrants that they are required in the organisation.
 Such a feeling serves as a corner stone to be interested to integrate into the organisation.
2. Determining the New Employees’ Need for Information:
 The central element that guides the designing of an induction programme is to decide first
“What do the new employees need to know now?”
 Many a times, the new employees are given information which are not immediately
required but the required one is not given.
 Such information lack tends to make the new comer confused about the job and the
organisation.
 Therefore, it is important to decide the vital information a new entrant needs to receive on
his joining the organisation.

3. Determining How to Present the Information:

 Having being decided what information employees wants, the next important thing to be
decided is how to present the same to the new employees.
 Obviously, the required information needs to be presented to the new employees in the
right form and manner to have its maximum impact on the employees.
4. Delivering Induction Training by the Right Instructor:
 Much of the effectiveness of an induction programme depends on who conducts the
induction training.
  This is because induction training cannot be given by anyone, but by the right
instructor/trainer only.
 Possession of the required skill, knowledge and attitude are considered to be the
requisites of a right instructor.
 Therefore, the induction programme needs to be conducted by the right trainer only.
 If required the trainer be given induction training before he/she conducts the induction
training for the new entrants to the organisation.
5. Evaluating the Induction Programme:
 Like all other training programmes, whether or not an induction programme is effective is
determined by evaluating the programme.
 This is necessary to know to decide whether to continue the programme in future also or
not or whether the programme needs any improvement in future.
 In fact, it is the evaluation of the induction programme that makes the organisation know
whether the amount incurred in induction programme remains as an expenditure or has
turned into an investment.
 There are various methods employed to measure the effectiveness of training
programmes.

INDUCTION MEANING:
 Induction of Employee is the first step towards gaining an employees' commitment,
Induction is aimed at introducing the job and organization to the recruit and him or her to
the organization.
 Induction involves orientation and training of the employee in the organizational culture,
and showing how he or she is interconnected to (and interdependent on) everyone else in
the organization.
 The new employee’s first contact with his or her physical and human working
environment is extremely important, since it will condition his or her relationship with
the company.
 The employeeSchool of Distance Education must feel supported and important.
  The first person he or she will meet is the immediate supervisor, who should present the
corporate profile in addition to providing information on the organization’s background,
values, clientele, services offered, staff, and expected behaviour.
 The immediate superior will also specify the newcomer’s role.
 The points listed below should be covered during this meeting.

Purpose and Need

 An employee has to work with fellow employees and his supervisor.
 For this he must know them, the way they work and also the policies and practices of the
organization so that he may integrate himself with the enterprise.
 Any neglect in the area of induction and orientation may lead to high labour turnover,
confusion, wasted time and expenditure.

Induction Programme : A good induction programme should cover the following:

1. The company, its history and products, process of production and major operations involved in
his job.
2. The significance of the job with all necessary information about it including job training and
job hazards.
3. Structure of the organization and the functions of various departments.
4. Employee’s own department and job, and how he fits into the organization.
5. Personnel policy and sources of information.
6. Company policies, practices, objectives and regulations.
7. Terms and conditions of service, amenities and welfare facilities.
8. Rules and regulations governing hours of work and over-time, safety and accident prevention,
holidays and vacations, methods of reporting, tardiness and, absenteeism.
9. Grievances procedure and discipline handling.
10. Social benefits and recreation services.
11. Opportunities, promotions, transfer, suggestion schemes and job satisfaction.
INDUCTION:
It is the process of inducting or orienting a new employee into the social setting of his work.
Steps:
i) Familiarising the new employee with his new surroundings and company rules & regulations.
ii) Integrating his personal goals with the organization goals.

Socialisation:
• “ long process of planned and unplanned, formal and informal and experience through which
an individual acquires the attitudes, behaviours and knowledge needed to successfully participate
as a member of an organisation and learns the firm’s culture.”
• Mc Shane “is the process by which new comers learn the behaviours, values, beliefs and social
knowledge to accept their new roles and function effectively within the organisation”
• Robert Kreitner “organisational socialisation is the process of transforming outsiders into
accepted insiders
Assumptions of socialization:
i) It strongly influence employee performance and organizational stability.
ii) New member suffer from anxiety [Stress]- induced stress.
 Socialisation is the process of adaption. It is not confined to new recruits.
 It is needed like transfer, promotion.
 Induction is only a part of socialization.
“Socialisation can be conceptualized as a process made up of the folllowing phases:
• Pre arrival – Acclimatize the new comers about the culture of the organisation
• Encounter
– Confront the reality
– Culture shock - Not done properly
– Feel suffocated and incline to quit
• Metamorphosis
– Problems from encounter stage
– Comfortable with the organisation
– System
– Rules
• Outcomes
– Productivity
– Commitment
– Turnover 65

Methods of socialisation
• Stories
• Rituals
• Material symbols
• Language

Socialisation benefits
• Helps in understanding organisation culture
• Contributes to employee’s long term success
• Helps in adjustment
• Helps in employee engagement
• Provides job satisfaction.

Unit III - Training and Development: Meaning – Importance - Purpose and Methods –
Training Need Analysis and Training Evaluation – Human Resource Development: Concept -
Need - Interventions - Performance Appraisal: Objectives - Uses and Methods: Traditional and
Modern methods (360 & 720 Degree KRI, KPI) - Balanced Score Card system - Barriers of
Performance Appraisal - Career Planning - Succession planning and Competency Mapping and
development.

QUE 1: TRAINING

According to Edwin B. Flippo “ training is the act of increasing the knowledge and skills of an
employee for doing a particular job.”

Michael Armstrong points “ training is the systematic modification of behaviour through

learning which occurs as a result of education, instruction, development and planned experience”.
In the opinion of Michael J. Jucious, “Training is any process by which the attitudes, skills and
abilities of employees to perform specific jobs are improved.”

Pattanayak Biswajeet^^(2005) has defined 'training' as a planned programme designed to

improve performance and to bring about measurable changes in knowledge, skills, attitude, and
social behavior of employees doing a particular job.

Objective of Training and Development

1. To Increase Efficiency
2. To Increase Morale of Employees
3. To Establish Better Human Relations
4. To Reduce Supervision
5. To Increase Organizational Viability and Flexibility.

QUE 2: IMPORTANCE OF TRAINING

The importance of employee training can best be appreciated with the help of various advantages
it offers to both employees and employers. These are explained under the following heads:

1. Better Performance: Training improves employee’s ability and skills and, in turn, improves
employee’s performance both in quantity and quality. Better or increased employee performance
directly leads to increased operational productivity and increased organisational profits. Improve
ments in employee performance/productivity in developed countries lend support to this
statement.

2. Improved Quality: In formal training programmes, the best methods of performing jobs are
standardised and then taught to employees. This offers two-fold benefits. Firslty, unifromity in
work performance helps improve the quality of work or service. Secondly, better informed, or
say, trained workers are less likely to make operational mistakes.
3. Less Supervision: A trained worker is self-reliant. He knows his work and way to perform it
well. Therefore, his work requires less supervision. The supervisor can devote his time on more
urgent works.
4. Less Learning Period: A well planned and systematically organised training programme
reduces the time and cost involved in learning. Training enables to avoid waste of time and
efforts in learning through trial and error method
5. High Morale: Training not only improves the ability and skill of employees, but also changes
employee attitude toward positive. Higher performance, job satisfaction, job security and
avenues for internal promotion lead to high morale among the employees. high morale, in turn,
makes employees more loyal to the organisation.
6. Personal Growth: Training improves employee’s ability, knowledge and skills and, thus,
prevents employee’s obsolescence. This makes employees growth-oriented.
7. Favourable Organisational Climate: The aforesaid advantages combinedly lead to an
improved and favourable organisational climate characterised by better industrial relations and
disciplines, reduced resistence to change, reduced absenteeism and turnover of employees, and
improved stability of organisation.

IMPORTANCE OF TRAINING
Training is crucial for organizational development and success. It is fruitful to both employers
and employees of an organization. An employee will become more efficient and productive if he
is trained well. The benefits of training can be summed up as:
1. Improves Morale of Employees- Training helps the employee to get job security and job
satisfaction. The more satisfied the employee is and the greater is his morale, the more he will
contribute to organizational success and the lesser will be employee absenteeism and turnover.
2. Less Supervision- A well trained employee will be well acquainted with the job and will need
less of supervision. Thus, there will be less wastage of time and efforts.
3. Fewer Accidents- Errors are likely to occur if the employees lack knowledge and skills
required for doing a particular job. The more trained an employee is, the less are the chances of
committing accidents in job and the more proficient the employee becomes.
4. Chances of Promotion- Employees acquire skills and efficiency during training. They
become more eligible for promotion. They become an asset for the organization.
5. Increased Productivity- Training improves efficiency and productivity of employees. Well
trained employees show both quantity and quality performance. There is less wastage of time,
money and resources if employees are properly trained.
IMPORTANCE OF TRAINING

7.4.1 To the Organization

1. Gets more effective in decision-making and problem-solving.
2. Improve the morale of the workforce.
3. Helps people identify the organizational goal.
4. Aids in developing leadership skills, motivation, loyalty and better attitude.
5. Aids in improving productivity and quality of work.
6. Aids in understanding and carrying out organizational policies.
7. Aids in organizational development.
8. Creates an appropriate climate for growth and communication.
9. Helps employees adjust to change.

7.4.2 To the Employees

1. Increases job satisfaction and recognition.
2. Moves a person towards personal goals while improving interactive skills.
3. Helps in eliminating fear of attempting new tasks.
4. Provides the trainee an avenue for growth.
5. Through training and development, motivational variables of recognition, achievement,
growth, responsibility and advancement are internalized and operationalised.
6. Provides information for improving leadership, communication skills and attitudes.
7. Helps to handle stress, tension, frustration and conflict.

7.4.3 For Personnel and Human Relation

1. Improve inter-personnel skills
2. Improves morale
3. Builds cohesiveness in groups
4. Makes the organization a better place to work and live
5. Provides information on other governmental laws and administrative policies.

QUE 3: PURPOSE OF TRAINING

The need for Training may generally arise for the following-
To improve the efficiency of employees
To reduce wastage of time and money,
To have quality output,
To bring down supervision,
To have preventive maintenance,
To achieve optimum performance,
To boost morale of employees,
To prepare workforce for future challenging work,
To reduce absenteeism,
To bring down the grievances,
PURPOSE FOR TRAINING
Training is the act of improving one’s knowledge and skill to improve his/her job performance.
Training is job-oriented. It bridges the gap between what the employee has and what the job
demands.
Several conditions have contributed to make the organisations realize and recognize the need for
imparting training to their employees.
Venkata Ratnam and Srivastava have listed these conditions as follows:
(i) Sub-optimal performance of organisations in government, public and private sectors.
(ii) The ever-widening gap between planning, implementation and completion of projects.
(iii) Technological change necessitating acquisition of new knowledge, ability and skills.
(iv) Increasing qualitative demand for managers and workmen.
(v) Increasing uncertainties and complexities in the total environment necessitating flexible and
adaptive responses from organisations.
(vi) Need for both individuals and organisations to grow at rapid pace.
(vii) To meet challenges posed by the global competition.
(viii) To harness the human potential and give expression to their creative urges.
(ix) To enable employees to move from one job to another.
(x) To bridge the gap between what employee has in terms of knowledge and skill and what his/
her job actually demands.
PURPOSE FOR TRAINING
Training is given on four basic grounds:
1. New candidates who join an organization are given training. This training familiarizes them
with the organizational mission, vision, rules and regulations and the working conditions.
2. The existing employees are trained to refresh and enhance their knowledge.
3. If any updations and amendments take place in technology, training is given to cope up with
those changes. For instance, purchasing new equipment, changes in technique of production,
computer impartment. The employees are trained about use of new equipments and work
methods.
4. When promotion and career growth become important. Training is given so that employees are
prepared to share the responsibilities of the higher-level job.

PURPOSE OF TRAINING
1. Newly recruited employees require training so as to perform their tasks effectively.
Instruction, guidance, coaching help them to handle jobs competently without any wastage.
2. Training is necessary to prepare existing employees for higher-level jobs (promotion).
3. Existing employees require refresher training so as to keep abreast of the latest development
in the job operations.
4. Training is necessary when one moves from one job to another (transfer).
5. Training is necessary to make employee mobile and versatile. They can be placed on
various jobs depending on organisational needs.
6. Training is needed to bridge the gap between what the employee has and what the job
demands.

PURPOSE OF TRAINING
Training is crucial for organizational development and success. It is fruitful to both employers
and employees of an organization. An employee will become more efficient and productive if he
is trained well.
Training is given on four basic grounds:

1. New Hire Orientation

Training is particularly important for new employees. This can be conducted by someone within
the company and should serve as a platform to get new employees up to speed with the processes
of the company and address any skill gaps.
2. Tackle shortcomings
Every individual has some shortcomings and training and development helps employees iron
them out. For example divide the entire headcount in several groups to provide focused training
which is relevant to those groups - sales training, first time managers, middle management,
senior leadership, executive leadership.
3. Improvement in performance
If shortcomings and weaknesses are addressed, it is obvious that an employee's performance
improves. Training and development, however, also goes on to amplify your strengths and
acquire new skill sets. It is important for a company to break down the training and development
needs to target relevant individuals.
4. Employee satisfaction
A company that invests in training and development generally tends to have satisfied employees.
However, the exercise has to be relevant to the employees and one from which they can learn
and take back something. It will be futile if training and development become tedious and dull,
and employees attend it merely because they have to. As a company, We should stress on
industry specific training and send many employees for international seminars and conferences
that can be beneficial to them.
5. Increased productivity
In a rapidly evolving landscape, productivity is not only dependent on employees, but also on the
technology they use. Training and development goes a long way in getting employees up to date
with new technology, use existing ones better and then discard the outdated ones. This goes a
long way in getting things done efficiently and in the most productive way.
6. Self-driven
Employees who have attended the right trainings need lesser supervision and guidance. Training
develops necessary skill sets in employees and enables them to address tasks independently. This
also allows supervisors and management to focus on more pressing areas.

QUE 3: METHODS OF TRAINING

Training Methods: On Job Training and off the Job Training Methods
A large variety of methods of training are used in business. Even within one organization
different methods are used for training different people. All the methods are divided into two
classifications for:
A. On-the-job Training Methods:
1. Coaching
2. Mentoring
3. Job Rotation
4. Job Instruction Technology
5. Apprenticeship
6. Understudy
B. Off-the-Job Training Methods:
1. Lectures and Conferences
2. Vestibule Training
3. Simulation Exercises
4. Sensitivity Training
5. Transactional Training

A. On-the-job training Methods:

Under these methods new or inexperienced employees learn through observing peers or
managers performing the job and trying to imitate their behaviour.
These methods do not cost much and are less disruptive as employees are always on the job,
training is given on the same machines and experience would be on already approved standards,
and above all the trainee is learning while earning.
Some of the commonly used methods are:
1. Coaching:
Coaching is a one-to-one training. It helps in quickly identifying the weak areas and tries to
focus on them.
It also offers the benefit of transferring theory learning to practice.
The biggest problem is that it perpetrates the existing practices and styles.
In India most of the scooter mechanics are trained only through this method.
2. Mentoring:
The focus in this training is on the development of attitude. It is used for managerial employees.
Mentoring is always done by a senior inside person.
It is also one-to- one interaction, like coaching.
3. Job Rotation:
It is the process of training employees by rotating them through a series of related jobs.
Rotation not only makes a person well acquainted with different jobs, but it also alleviates
boredom and allows to develop rapport with a number of people. Rotation must be logical.
4. Job Instructional Technique (JIT):
It is a Step by step (structured) on the job training method in which a suitable trainer
(a) prepares a trainee with an overview of the job, its purpose, and the results desired,
(b) demonstrates the task or the skill to the trainee,
(c) allows the trainee to show the demonstration on his or her own, and
(d) follows up to provide feedback and help.
This method is a valuable tool for all educators (teachers and trainers). It helps us:
a. To deliver step-by-step instruction
b. To know when the learner has learned
c. To be due diligent (in many work-place environments)
5. Apprenticeship:
Apprenticeship is a system of training a new generation of practitioners of a skill.
This method of training is in vogue in those trades, crafts and technical fields in which a long
period is required for in direct association with and also under the direct supervision of their
masters.
The object of such training is to make the trainees all-round craftsmen.
It is an expensive method of training. Also, there is no guarantee that the trained worker will
continue to work in the same organization after securing training.
The apprentices are paid remuneration according the apprenticeship agreements.

6. Understudy:
In this method, a superior gives training to a subordinate as his understudy like an assistant to a
manager or director (in a film).
The subordinate learns through experience and observation by participating in handling day to
day problems.
Basic purpose is to prepare subordinate for assuming the full responsibilities and duties.

B. Off-the-job Training Methods:

Off-the-job training methods are conducted in separate from the job environment, study material
is supplied, there is full concentration on learning rather than performing, and there is freedom of
expression. Important methods include:
1. Lectures and Conferences:
Lectures and conferences are the traditional and direct method of instruction.
Every training programme starts with lecture and conference.
It’s a verbal presentation for a large audience. However, the lectures have to be motivating and
creating interest among trainees.
The speaker must have considerable depth in the subject.
In the colleges and universities, lectures and seminars are the most common methods used for
training.
2. Vestibule Training:
Vestibule Training is a term for near-the-job training, as it offers access to something new
(learning).
In vestibule training, the workers are trained in a prototype environment on specific jobs in a
special part of the plant.
An attempt is made to create working condition similar to the actual workshop conditions.
After training workers in such condition, the trained workers may be put on similar jobs in the
actual workshop.
This enables the workers to secure training in the best methods to work and to get rid of initial
nervousness.
During the Second World War II, this method was used to train a large number of workers in a
short period of time.
It may also be used as a preliminary to on-the job training.
Duration ranges from few days to few weeks. It prevents trainees to commit costly mistakes on
the actual machines.
3. Simulation Exercises:
Simulation is any artificial environment exactly similar to the actual situation.
There are four basic simulation techniques used for imparting training: management games, case
study, role playing, and in-basket training.School of Distance Education
(a) Management Games:
Properly designed games help to ingrain thinking habits, analytical, logical and reasoning
capabilities, importance of team work, time management, to make decisions lacking complete
information, communication and leadership capabilities.
Use of management games can encourage novel, innovative mechanisms for coping with stress.
Management games orient a candidate with practical applicability of the subject.
These games help to appreciate management concepts in a practical way.
Different games are used for training general managers and the middle management and
functional heads – executive Games and functional heads.
(b) Case Study:
Case studies are complex examples which give an insight into the context of a problem as well as
illustrating the main point.
Case Studies are trainee centered activities based on topics that demonstrate theoretical concepts
in an applied setting.
A case study allows the application of theoretical concepts to be demonstrated, thus bridging the
gap between theory and practice, encourage active learning, provides an opportunity for the
development of key skills such as communication, group working and problem solving, and
increases the trainees” enjoyment of the topic and hence their desire to learn.
(c) Role Playing:
Each trainee takes the role of a person affected by an issue and studies the impacts of the issues
on
human life and/or the effects of human activities on the world around us from the perspective of
that person.
It emphasizes the “real- world” side of science and challenges students to deal with complex
problems with no single “right” answer and to use a variety of skills beyond those employed in a
typical research project.
In particular, role-playing presents the student a valuable opportunity to learn not just the course
content, but other perspectives on it.
The steps involved in role playing include defining objectives, choose context & roles,
introducing the exercise, trainee preparation/research, the role-play, concluding discussion, and
assessment. Types of role play may be multiple role play, single role play, role rotation, and
spontaneous role play.
(d) In-basket training:
In-basket exercise, also known as in-tray training, consists of a set of business papers which may
include e-mail SMSs, reports, memos, and other items. Now the trainer is asked to priorities the
decisions to be made immediately and the ones that can be delayed.
4. Sensitivity Training:
Sensitivity training is also known as laboratory or T-group training.
This training is about making people understand about themselves and others reasonably, which
is done by developing in them School of Distance Education social sensitivity and behavioral
flexibility.
It is ability of an individual to sense what others feel and think from their own point of view.
It reveals information about his or her own personal qualities, concerns, emotional issues, and
things that he or she has in common with other members of the group.
It is the ability to behave suitably in light of understanding.
A group’s trainer refrains from acting as a group leader or lecturer, attempting instead to clarify
the group processes using incidents as examples to clarify general points or provide feedback.
The group action, overall, is the goal as well as the process.
5. Transactional Analysis:
It provides trainees with a realistic and useful method for analyzing and understanding the
behavior
of others.
In every social interaction, there is a motivation provided by one person and a reaction to that
motivation given by another person.
This motivation reaction relationship between two persons is known as a transaction.
Transactional analysis can be done by the ego (system of feelings accompanied by a related set
of behaviors states of an individual).
TRAINING METHODS
Training is an instructor-led, content-based intervention, leading to desired changes
in behaviour.

There are two broad types of training available: on-the-job and off-the-job techniques.
ON- THE –JOB TRAINING
On-the job training is an important way in which people acquire relevant knowledge
and skills at work.
on-the-job training (OJT) can be defined as an activity undertaken at the workplace which is
designed to improve an individual’s skills or knowledge. OJT is a well-established and well-used
intervention designed to enhance individual skills and capabilities.
On-the-job training generally takes place in the normal work station, the task very often
contributing directly to the output of the department.
The main advantages of on-the- job techniques are that they are highly practical, and employees
do not lose working time while they are learning.
Techniques include orientations Job instruction training, Apprenticeships, Internships and
assistantships, Job rotation and coaching.

THE ADVANTAGES OF USING OJT

➢ Training can be delivered at the optimum time: for example immediately before a job is to be
performed ‘for real’ in the workplace.
➢ The trainee will have opportunities to practice immediately.
➢ The trainee will have immediate feedback.
➢ Training is delivered by colleagues and can go someway to integrate the trainee into the team.

THE DISADVANTAGES OF USING OJT

➢ There is a tendency to fit OJT in when it is convenient for office routine rather than at the
optimum time for learning.
➢ The training may be given piecemeal and not properly planned, and the trainee gains a
fragmented picture of the organisation.
➢ Too much training can be delivered in one session leading to ‘information overload’ and
trainee fatigue.
➢ The trainer may not have sufficient knowledge of the process or expertise in instructional
techniques (a ‘train the trainer’ course may be appropriate).
➢ If immediate practice is not accompanied by feedback the trainee can feel abandoned .
Job Instruction Training
 Job Instruction Training (JIT) is a logical outgrowth of Job Hazard Analysis.
 It is a proven technique for teaching new skills and safe, healthful work habits faster and
more
effectively.
 All new employees and those transferred to new jobs should receive JIT.
 Job Instruction Technique (JIT) uses a strategy with focus on knowledge (factual and
procedural), skills and attitudes development.
Mentoring
 Mentoring is an ongoing relationship that is developed between a senior and junior employee.
 Mentoring provides guidance and clear understanding of how the organization goes to
achieve its vision and mission to the junior employee.
 Mentoring is one of the important methods for preparing them to be future executives.
 This method allows the mentor to determine what is required to improve mentee’s
performance. Once the mentor identifies the problem, weakness, and the area that needs to be
worked upon, the mentor can advise relevant training.
 The mentor can also provide opportunities to work on special processes and projects that
require use of proficiency.
 Some key Points on Mentoring
➢ Mentoring focus on attitude development
➢ Conducted for management-level employees
➢ Mentoring is done by someone inside the company
➢ It is one-to-one interaction
➢ It helps in identifying weaknesses and focus on the area that needs improvement
Coaching is one of the training methods, which is considered as a corrective method for
inadequate performance.
A coach is the best training plan because It is one-to-one interaction
It can be done on phone, meetings, through e-mails, chat
It provides an opportunity to receive feedback from an expert
It helps in identifying weaknesses and focus on the area that needs improvement
PROCEDURE OF THE COACHING
➢ Understand the participant’s job, the knowledge, skills, and attitudes, and resources required
to meet the desired expectation
➢ Meet the participant and mutually agree on the objective that has to be achieved
➢ Mutually arrive at a plan and schedule
➢ At the job, show the participant how to achieve the objectives, observe the performance and
then provide feedback
➢ Repeat step 4 until performance improves

OFF-THE-JOB TRAINING
Off-the-job training takes place away from normal work situations — implying that the
employee does not count as a directly productive worker while such training takes place.
Off-the-job training has the advantage that it allows people to get away from work and
concentrate more thoroughly on the training itself.
This type of training has proven more effective in inculcating concepts and ideas.
Off-the-job training is conducted away from the work situation and therefore is more often than
not simulated and/or hypothetical.
Techniques include lectures, Special study, Films, Television, Conferences or discussions, Case
studies, Role playing, Simulation, Programmed instruction and Laboratory training
Off the Job
➢ Learn from specialists in that area of work who can provide more in depth study
➢ Can more easily deal with groups of workers at the sometime
➢ Employees respond better when taken away from pressures of working environment
➢ Workers may be able to obtain qualifications and certificates
Lectures : The lecture is a set of words spoken by the instructor. It is conducted in a verbal
format offering a relatively passive and un stimulating experience for learners.
Advantages and disadvantages of lectures as quoted from Bonwell (1996) who cited Cashin
(1985) as the original author.
Advantages of the Lecture
➢ Effective lecturers can communicate the intrinsic interest of a subject through their
enthusiasm.
➢ Lectures can present material not otherwise available to students.
➢ Lectures can be specifically organized to meet the needs of particular audiences.
➢ Lectures can present large amounts of information.
➢ Lectures can be presented to large audiences.
➢ Lecturers can model how professionals work through disciplinary questions or problems.
➢ Lectures allow the instructor maximum control of the learning experience.
➢ Lectures present little risk for students.
➢ Lectures appeal to those who learn by listening.
Disadvantages of the Lecture
➢ Lectures fail to provide instructors with feedback about the extent of student learning.
➢ In lectures students are often passive because there is no mechanism to ensure that they are
intellectually engaged with the material.
➢ Students’ attention wanes quickly after fifteen to twenty-five minutes.
➢ Information tends to be forgotten quickly when students are passive.
➢ Lectures presume that all students learn at the same pace and are at the same level of
understanding.
➢ Lectures are not suited for teaching higher orders of thinking such as application, analysis,
synthesis, or evaluation; for teaching motor skills, or for influencing attitudes or values.
➢ Lectures are not well suited for teaching complex, abstract material.
➢ Lectures requires effective speakers.
➢ Lectures emphasize learning by listening, which is a disadvantage for students who have other
learning styles
Orations are for new employees. The first several days on the job are crucial in the success of
new employees.
This point is illustrated by the fact that 60 percent of all employees who quit do so in the first ten
days. Orientation training should emphasize the following topics:
➢ The company’s history and mission.
➢ The key members in the organization.
➢ The key members in the department, and how the department helps fulfill the mission of the
company.
➢ Personnel rules and regulations.

Presentation
The presentation of extension talks and the skill teaching plans by the participants forms one of
the important techniques adopted in all the courses.
These presentations may either be an individual or a group activity.
The extension talks delivered by the participants would invariably be supported by some kinds of
visual aids which they would prepare by themselves in consultation with the faculty members.
The participants are requested to present their talk plans and skill plans, after proper planning &
practice/rehearsal.

Demonstration
The demonstration step gives trainees the opportunity to see and hear the details related to the
skill being taught.
Those details include the necessary background knowledge, the steps or procedure, the
nomenclature, and the safety precautions.
The repetition step helps the average and slow learners and gives the trainees an additional
opportunity to see and hear the skill being taught.
The performance step gives all trainees the opportunity to become proficient. In short, this
method is recommended because it leaves nothing to chance.
This method is a visual display of how something works or how to do something.

Advantages of Demonstrations
➢ People are likely to remember what they have learnt, because they are ‘learning by doing’.
➢ People can test out new methods and products and ask questions there and then to get
immediate answers.
➢ Demonstrations are convincing because they can take place in the real situation (e.g. the home
or farm of community members).
➢ The local language can be used, and literacy is not required.
➢ Demonstrations are liked by people who are not comfortable in formal training institutions

Readings
Reading can efficiently expose learners to large quantities of content.
Reading assignments should be accompanied with some feedback activities which measure and
assist the retention of the content.
Another approach to the reading is accountability; the learners can be supplied with a syllabus, a
carefully structured notepad on which they can take notes.
When Instructors use readings as a post-class exercise, such accountability may apper less
necessary.
That assumption needs to be sharply challenged.on of the advantage of reading is that can be
kept to minimum.
Skits
Skit is a prepared enactment, with precise dialogue provided for the actors, who are usually
students reading their roles from scripts.
Skits reflects differing points of view, with several: characters” facing a common crisis which
they approach with dramatic differences due to their contrasting value system.
Usually rehearsals are not necessary for skits.
Field Trips
Field Trips or tours may or may not be participative learning experiences.
The trip motivates and instills the learning process.
The team is given a questionnaire and asked to find the answers on the field trip.
These field trips tend to be more interesting and informative than a classroom environment
Interactive Demonstrations
Interactive demonstrations allow learner-watchers to do something instead of merely observe.
Job Instruction Training (JIT) is an example for this. Once the climate is set, the instructor tells
and shows the first step of the task, as learners do that first step right along with the instructor.
This permits cumulative repetition and the practice that makes perfect.
Behavior Modeling
The words of this method tell what sort of a model or ideal enactment of desired behavior lets
learners discover what actions and standards are expected of them.
Typical behaviors to model would be managerial skills, as making assignments, delegating,
counseling, asserting, or disciplining.
Brainstorming
It is a sort of problem-solving situation. It is used to teach learners to suspend judgment until a
maximum number of ideas have been generated.
It is also used to train people to listen positively to the ideas of others, refraining from negative
comments.
Brainstorming requires people of a group to think of ideas and express them after suspending
everything else for a while.
1. Generate, don’t evaluate. The more ideas, the better.
2. The ideas that already have been put forward have to be amended. The amendment
includes adding, deleting, consolidating, substituting elements or reversing.
There should be arrangement for debating or analyzing the idea by putting it for use.
The total brainstorm includes generation, analysis and action planning. The best idea
is selected as the best solution.
Role Plays
Role play can be defined as a technique in which people are presented with a real or artificial
environment and they are exposed with some kind of case or situation and they need to exhibit
the same in form of roles.
It is a spontaneous human interaction involving realistic human behavior under artificial or
stimulated environment.
It consists of interviews or series of interview in which the participants or the trainees are
provided with a role brief and a set of circumstances which they need to enact.
The trainee develops a strategy to how should he reactor think in a particular situation and
possible suggestive solutions for resolving the problem or analyzing the situation.
He also learns and forecasts what the other party or as per the case may be what can be the other
reaction.
This technique thus not only leads to self learning about expected job outcome or to create a fit
in the job but also helps in understanding others perception about the task or issue.
Objectives of Role play as a training technique-
1) It helps in developing a better understanding of the job
2) It helps in understanding how to handle a particular situation.
3) It helps in developing better understanding of the issue an better decision making
4) It helps in anticipating reaction of other party
5) It helps in developing communication, management development and leadership quality.
6) It helps in improvement of interpersonal relationship
7) It helps in providing an insight to understanding behavioral patterns of others Salient Features
of Role play as a training method for learning
Benefits or outcome of role play as a training technique
a) It helps in both cognitive and effective development of trainees and better learning by doing.
b) It permits practice by repetition and helps in better reinforcement
c) It also helps in improving human relation since it helps I developing empathy
d) It helps in making people sensitive towards others
e) It helps in better SWOT analysis of individuals and thus the feedback given helps in
identifying and overcoming the deficiencies.
f) It enables the role player to control his behavior and enact as if he is enacting in a real life
situation
g) It helps in bringing attitudinal changes in the employees as trainees
h) It is a more practical approach than other technique since in this the learning by doing and
feedback that whether a behavior reflected is acceptable or requires change can be given.
Reverse Role Plays
Reverse role-plays are helpful methods for gaining understanding of another person’s view point.
It works equally well when the objective is to see how oneself is perceived by others.
Reverse role-playing requires sensitive monitoring by the instructors.
Simulation
Simulations somewhat like action mazes being role-played.
simulation are training techniques that attempt to bring realistic decision making situations to the
trainee.
Likely problems and alternative solutions are presented for discussion.
The adage there is no better trainer than experience is exemplified with this type of training.
Experienced employees can describe real world experiences, and can help in and learn from
developing the solutions to these simulations.
This method is cost effective and is used in marketing and management training.
Games
T & D specialties feel that the gamed simulations increase the energy and commitment of the
participants.
When people participate in games, may behaviors manifest themselves.
Some of these behaviors may be defined as contributive to or counterproductive to group goals.
Thus games are sometimes used in organization development programs as both diagnostic and
training tools.
Games can be used to develop specific skills also.
Critical Incidents
Critical incident method also identifies and analysis actual participant experiences as a basis for
better understanding real problems, or expanding insights by analyzing the critical incidents in
the career of the participants.
The critical incident method varies slightly from the clinic or from just having participants write
up their own case studies.
This method is used extensively in upper management or executive development programs.
Computer-Based Training
CBT- adds a valuable dimension in speeding up decision-making and also compressing the
training time-scale.
As the cost of computer hardware has gone up, micro-technology promotes its use in the training
area.
Time-sharing requires a link-up of the terminal to a remote computer by telephone line.
The micro-computer can be accommodated in a limited office space and the complete system is
under the user’s control.
Computers are used for the teaching and training program

TRAINING METHODS

ORIENTATIONS
Orientation training is vital in ensuring the success of new employees.
Whether the training is coducted through an employee handbook, a lecture, or a one-on-one
meeting with a supervisor, newcomers should receive information on the company's history and
strategic position, the key people in authority at the company, the structure of their department
and
how it contributes to the mission of the company, and the company's employment policies, rules,
and regulations.
LECTURES
A verbal method of presenting information, lectures are particularly useful in situations when the
goal is to impart the same information to a large number of people at one time.
Since they eliminate the need for individual training, lectures are among the most cost effective
training methods.
But the lecture method does have some drawbacks. Since lectures primarily involve one-way
communication, they may not provide the most interesting or effective training.
In addition, it may be difficult for the trainer to gauge the level of understanding of the material
within a large group.
CASE STUDY
The case method is a non-directed method of study whereby students are provided with practical
case reports to analyze.
The case report includes a thorough description of a simulated or real-life situation.
By analyzing the problems presented in the case report and developing possible solutions,
students can be encouraged to think independently as opposed to relying upon the direction of an
instructor. Independent case analysis can be supplemented with open discussion with a group.
The main benefit of the case method is its use of real-life situations.

ROLE PLAYING
In role playing, students assume a role outside of them and play out that role within a group.
A facilitator creates a scenario that is to be acted out by the participants under the guidance of the
facilitator.
While the situation might be contrived, the interpersonal relations are genuine.
Furthermore, participants receive immediate feedback from the facilitator and the scenario itself,
allowing better understanding of their own behavior.
This training method is cost effective and is often applied to marketing and management training.
SIMULATIONS
Games and simulations are structured competitions and operational models that emulate real-life
scenarios.
The benefits of games and simulations include the improvement of problem-solving and
decision-making skills, a greater understanding of the organizational whole, the ability to study
actual problems, and the power to capture the student's interest.
COMPUTER-BASED TRAINING
Computer-based training (CBT) involves the use of computers and computer-based instructional
materials as the primary medium of instruction.
Computer-based training programmes are designed to structure and present instructional
materials and to facilitate the learning process for the student.
A main benefit of CBT is that it allows employees to learn at their own pace, during convenient
times. Primary uses of CBT include instruction in computer hardware, software, and operational
equipment.
The last is of particular importance because CBT can provide the student with a simulated
experience of operating a particular piece of equipment or machinery while eliminating the risk
of damage to costly equipment by a trainee or even a novice user.
WEB-BASED TRAINING
(WBT) is an increasingly popular form of CBT. The greatly expanding number of organizations
with Internet access through high-speed connections has made this form of CBT possible.
By providing the training material on a Web page that is accessible through any Internet browser,
CBT is within reach of any company with access to the Web.
The terms "online courses" and "web-based instruction" are sometimes used interchangeably
with WBT.
AUDIOVISUAL TRAINING
Audiovisual training methods include television, films, and videotapes.
Like case studies, role playing, and simulations, they can be used to expose employees to "real
world" situations in a time-and cost-effective manner.
The main drawback of audiovisual training methods is that they cannot be customized for a
particular audience, and they do not allow participants to ask questions or interact during the
presentation of material.
APPRENTICESHIPS AND INTERNSHIPS
Apprenticeships are a form of on-the-job training in which the trainee works with a more
experienced employee for a period of time, learning a group of related skills that will eventually
qualify the trainee to perform a new job or function.
Apprenticeships are often used in production-oriented positions.
Internships are a form of apprenticeship that combines on-the-job training under a more
experienced employee with classroom learning.
JOB ROTATION
Another type of experience-based training is job rotation, in which employees move through a
series of jobs in order to gain a broad understanding of the requirements of each.
Job rotation may be particularly useful in small businesses, which may feature less role
specialization than is typically seen in larger organizations
COUNSELLING
The latest trend catching up in the corporate HR across the world is 'Employee Counselling at
Workplace'.
In the world of ever increasing complexity and the stress in the lives, especially the workplaces
of the employees, employee counselling has emerged as the latest HR tool to attract and retain its
best employees and also to increase the quality of the workforce.
Employee counselling can be explained as providing help and support to the employees to face
and sail through the difficult times in life.
At many points of time in life or career people come across some problems either in their work
or personal life when it starts influencing and affecting their performance and, increasing the
stress levels of the individual.
Counselling is guiding, consoling, advising and sharing and helping to resolve their problems
whenever the need arises.
Technically, Psychological Counselling, a form of counselling is used by the experts to analyze
the work related performance and behaviour of the employees to help them cope with it, resolve
the conflicts and tribulations and re-enforce the desired results.
MENTORING
Mentoring is a relationship in which a senior manager in an organization assumes the
responsibility for grooming a junior person.
Technical, interpersonal and political skills are generally conveyed in such a relationship from
the more experienced person.
A mentor is a teacher, spouse, counselor, developer of skills and intellect, host, guide, exemplar,
and most importantly, supporter and facilitator in the realization of the vision the young person
has about the kind of life he wants as an adult.
The main objective of mentoring is to help an employee attain psychological maturity and
effectiveness and get integrated with the organization.
In a work situation, such mentoring can take place at both formal and informal levels, depending
on the prevailing work culture and the commitment from the top management.
Formal mentoring can be very fruitful, if management invests time and money in such
relationship building exercises.

METHODS OF TRAINING: ON-THE-JOB TRAINING METHODS

1. JOB INSTRUCTION TRAINING (JIT): The JIT method (developed during World War
II) is a four step instructional process involving preparation, presentation, performance try out
and follow up. It is used primarily to teach workers how to do their current jobs.
A trainer, supervisor or co-worker acts as the coach.

2. COACHING: Coaching is a kind of daily training and feedback given to employees by

immediate supervisors. It involves a continuous process of learning by doing.
It may be defined as an informal, unplanned training and development activity provided by
supervisors and peers.
In coaching, the supervisor explains things and answers questions; he throws light on why things
are done the way they are; he offers a model for trainees to copy; conducts lot of decision
making meetings with trainees; procedures are agreed upon and the trainee is given enough
authority to make divisions and even commit mistakes.
Of course, coaching can be a taxing job in that the coach may not possess requisite skills to guide
the learner in a systematic way.
Sometimes, doing a full day's work may be more important than putting the learner on track.
3. MENTORING: Mentoring is a relationship in which a senior manager in an organization
assumes the responsibility for grooming a junior person.
Technical, interpersonal and political skills are generally conveyed in such a relationship from
the more experienced person.
A mentor is a teacher, spouse, counsellor, developer of skills and intellect, host, guide, exemplar,
and most importantly, supporter and facilitator in the realisation of the vision the young person
(protégé) has about the kind of life he wants as an adult.
The main objective of mentoring is to help an employee attain psychological maturity and
effectiveness and get integrated with the organisation.
In a work situation, such mentoring can take place at both formal and informal levels, depending
on the prevailing work culture and the commitment from the top management.
Formal mentoring can be very fruitful, if management invests time and money in such
relationship building exercises.
JOB ROTATION: This kind of training involves the movement of trainee from one job to
another. This helps him to have a general understanding of how the organisation functions.
The purpose of job rotation is to provide trainees with a larger organisational perspective and a
greater understanding of different functional areas as well as a better sense of their own career
objectives and interests.
Apart from relieving boredom, job rotation allows trainees to build rapport with a wide range of
individuals within the organisation, facilitating future cooperation among departments.

APPRENTICESHIP TRAINING:
Most craft workers such as plumbers and carpenters are trained through formal apprenticeship
programmes. Apprentices are trainees who spend a prescribed amount of time working with an
experienced guide, coach or trainer.
Assistantships and internships are similar to apprenticeships because they also demand high
levels of participation from the trainee.
An internship is a kind of on-the-job training that usually combines job training with classroom
instruction in trade schools, colleges or universities.
Coaching, as explained above, is similar to apprenticeship because the coach attempts to provide
a model for the trainee to copy.
One important disadvantage of the apprenticeship methods is the uniform period of training
offered to trainees.
People have different abilities and learn at varied rates.
Those who learn fast may quit the programme in frustration.
Slow learners may need additional training time.
It is also likely that in these days of rapid changes in technology, old skills may get outdated
quickly.
Trainees who spend years learning specific skills may find, upon completion of their
programmes,
that the job skills they acquired are no longer appropriate.

6. COMMITTEE ASSIGNMENTS:
In this method, trainees are asked to solve an actual organisational problem. The trainees have to
work together and offer solution to the problem.
Assigning talented employees to important committees can give these employees a broadening
experience and can help them to understand the personalities, issues and processes governing the
organisation.
It helps them to develop team spirit and work unitedly toward common goals.
However, managers should very well understand that committee assignments could become
notorious time wasting activities.

OFF-THE-JOB TRAINING METHODS

Under this method of training, the trainee is separated from the job situation and his attention
is focused upon learning the material related to his future job performance. Since the trainee is
not distracted by job requirements, he can focus his entire concentration on learning the job
rather than spending his time in performing it. There is an opportunity for freedom of expression
for the trainees. Off-the-job training methods are as follows:
1. Vestibule Training: In this method, actual work conditions are simulated in a class room.
Material, files and equipment - those that are used in actual job performance are also used
in the training. This type of training is commonly used for training personnel for clerical
and semi-skilled jobs. The duration of this training ranges from a few days to a few weeks.
Theory can be related to practice in this method.
2. Role Playing: It is defined as a method of human interaction that involves realistic behaviour
in imaginary situations. This method of training involves action, doing and practice. The
participants play the role of certain characters, such as the production manager, mechanical
engineer, superintendents, maintenance engineers, quality control inspectors, foreman,
workers and the like. This method is mostly used for developing interpersonal interactions
and relations.
3. Lecture Method: The lecture is a traditional and direct method of instruction. The instructor
organises the material and gives it to a group of trainees in the form of a talk. To be
effective, the lecture must motivate and create interest among the trainees. An advantage
of lecture method is that it is direct and can be used for a large group of trainees. Thus,
costs and time involved are reduced. The major limitation of the lecture method is that it
does not provide for transfer of training effectively.
4. Conference/discussion Approach: In this method, the trainer delivers a lecture and involves
the trainee in a discussion so that his doubts about the job get clarified. When big
organisations use this method, the trainer uses audio-visual aids such as blackboards,
mock-ups and slides; in some cases the lectures are videotaped or audio taped. Even the
trainee's presentation can be taped for self-confrontation and self-assessment. The
conference is, thus, a group-centered approach where there is a clarification of ideas,
communication of procedures and standards to the trainees. Those individuals who have
a general educational background and whatever specific skills are required - such as
typing, shorthand, office equipment operation, filing, indexing, recording, etc. - may be
provided with specific instructions to handle their respective jobs.
5. Programmed Instruction: This method has become popular in recent years. The subject
matter to be learned is presented in a series of carefully planned sequential units. These
units are arranged from simple to more complex levels of instruction. The trainee goes
through these units by answering questions or filling the blanks. This method is, thus,
expensive and time-consuming.
E-learning: It allows trainees to improve their skills and knowledge at their own Notes
comfortable pace. The trainee participates actively and is able to upgrade skills in a time
bound manner. Of course, e-training requires top management support, uninterrupted
internet access, investments in establishing learning portals and is not suitable for imparting
behavioural skills to trainees. Technology barriers like bandwidth will restrict and hamper
the effectiveness of e-learning. Learning effectiveness might never match the level of
classroom for a long time.
7. Behaviourally Experienced Training: Some training programmes focus on emotional and
behavioural learning. Here employees can learn about behaviour by role playing in
which the role players attempt to act their part in respect of a case, as they would behave
in a real-life situation. Business games, cases, incidents, group discussions and short
assignments are also used in behaviourally-experienced learning methods. Sensitivity
training or laboratory training is an example of a method used for emotional learning.
The focus of experiential methods is on achieving, through group processes, a better
understanding of oneself and others. These are discussed elaborately in the section covering
Executive Development Programmes.

QUE 4: TRAINING NEEDS ANALYSIS

Training Analysis (sometimes called Training Needs Analysis (TNA)) is the formal process of
identifying the training gap and its related training need.
TNA can be described as “the acquisition of skills, concepts or attitudes that result in improved
performance within the job environment”.

Training analysis as a process often covers:

➢ Review of current training
➢ Task analysis
➢ Identification of training gap
➢ Statement of training requirement
➢ Assessment of training options
➢ Cost benefit analysis of training options

Performing a training needs analysis is the first step in the training process and is critical for a
successful program.
The purpose of a needs analysis is to determine that training is the best solution and identify
what training is needed to fill the skill gap.
This step is often disregarded for reasons such as time constraints or lack of perceived value by
management.
However, skipping the training needs analysis can cause major problems..
The reasons for conducting a training needs analysis are:
➢ To determine whether training is needed
➢ To determine causes of poor performance
➢ To determine content and scope of training
➢ To determine desired training outcomes
➢ To provide a basis of measurement
➢ To gain management support

There are six steps fundamental to all effective training needs analysis.
1 – Identify Problem Needs
➢ Determine circumstance for training request
➢ Identify potential skill gap
➢ Set objectives

2 – Determine Design of Needs Analysis

➢ Establish method selection criteria
➢ Assess advantages and disadvantages for methods
3 – Collect Data
➢ Conduct interviews
➢ Administer surveys and questionnaires
➢ Conduct focus groups
➢ Observe people at work
➢ Review documents
4 – Analyze Data
➢ Conduct qualitative or quantitative analysis
➢ Determine solutions and recommendations
5 – Provide Feedback
➢ Write report and make oral presentation
➢ Determine next step – training needed?
6 – Develop Action Plan
➢ Use results as the basis for training design, development and evaluation.

QUE 5: TRAINING EVALUATION

The process of examining a training program is called training evaluation.

Training evaluation checks whether training has had the desired effect.
Training evaluation ensures that whether candidates are able to implement their learning in their
respective workplaces, or to the regular work routines.

 PURPOSES OF TRAINING EVALUATION

The five main purposes of training evaluation are:
Feedback: It helps in giving feedback to the candidates by defining the objectives and linking it
to learning outcomes.
Research: It helps in ascertaining the relationship between acquired knowledge, transfer of
knowledge at the work place, and training.
Control: It helps in controlling the training program because if the training is not effective, then
it can be dealt with accordingly.
Power games: At times, the top management (higher authoritative employee) uses the evaluative
data to manipulate it for their own benefits.
Intervention: It helps in determining that whether the actual outcomes are aligned with the
expected outcomes.

 PROCESS OF TRAINING EVALUATION

BEFORE TRAINING
The learner’s skills and knowledge are assessed before the training program.
During the start of training, candidates generally perceive it as a waste of resources because at
most of the times candidates are unaware of the objectives and learning outcomes of the program.
Once aware, they are asked to give their opinions on the methods used and whether those
methods confirm to the candidates preferences and learning style.
DURING TRAINING
It is the phase at which instruction is started.
This phase usually consist of short tests at regular intervals

AFTER TRAINING
It is the phase when learner’s skills and knowledge are assessed again to measure the
effectiveness of the training.
This phase is designed to determine whether training has had the desired effect at individual
department and organizational levels.
There are various evaluation techniques for this phase.

 TYPES OF EVALUATION
Evaluations are normally divided into two, formative and summative
1. FORMATIVE EVALUATION
is a method of judging the worth of a program while the program activities are in progress.
This part of the evaluation focuses on the process.
They permit the learner and the instructor to monitor how well the instructional objectives are
being met.
This allows the learner to master the required skills and knowledge.
2. SUMMATIVE EVALUATION The summative evaluation is a method of judging the
worth of a program at the end of the program activities. The focus is on the outcome.

 TECHNIQUES OF EVALUATION
The various methods of training evaluation are:
➢ Observation
➢ Questionnaire
➢ Interview
➢ Self diaries
➢ Self-recording of specific incidents
 Evaluation Criteria
According to Hamilan there are five criteria by which evaluation of training can take place;
➢ Reaction
➢ Learning
➢ Job Behavior
➢ Organization
➢ Ultimate Value

Reaction-Evaluate the trainee’s reaction to the program

Learning-In this trainer’ ability and trainees’ ability are evaluated on the basis of
quantity of the content learned.
Job Behavior-This evaluation includes the manner and extent which the trainee has
applied his learning to the job.
Organization-This evaluation measures the use of training earning and change in
the behavior of the department in the form of increased productivity. quality and
sales turnover etc.
Ultimate value-It is the measurement of the ultimate result of the contribution of the training
program to the company goals like survival, growth and profitability etc.

 TRAINING EVALUATION
The process of examining a training program is called training evaluation.
Training evaluation checks whether training has had the desired effect.
Training evaluation ensures that whether candidates are able to implement their learning in their
respective workplaces, or to the regular work routines

 TECHNIQUES OF EVALUATION
The various methods of training evaluation are:
 Observation
 Questionnaire
 Interview
 Self-diaries
 Self-recording of specific incidents School of Distance Education

 TYPES OF EVALUATION
Evaluating training (includes monitoring) addresses how one determines whether the goals or
objectives were met and what impact the training had on actual performance on the job.
Generally, there are four kinds of standard training evaluation:
1. Formative
2. Process
3. Outcome
4. Impact.
1. Formative evaluation provides ongoing feedback to the curriculum designers and developers
to ensure that what is being created really meets the needs of the intended audience.
2. Process evaluation provides information about what occurs during training. This includes
giving and receiving verbal feedback.
3. Outcome evaluation determines whether or not the desired results (e.g., what participants are
doing) of applying new skills were Achieved in the short-term.
4. Impact determines how the results of the training affect the strategic goal

QUE NO 6: MEANING – IMPORTANCE - PURPOSE AND METHODS OF DEV

According to S.B. Budhiraja, former Managing Director of Indian Oil Corporation. “Any activity
designed to improve the performance of existing managers and to provide for a planned growth
of
managers to meet future organisational requirements is called management development”.

According to Flippo ―executive development includes the process by which managers and
executives acquire not only skills and competency in their present job but also capabilities for
future managerial tasks of increasing difficulty and scope.
OBJECTIVES OF EXECUTIVE DEVELOPMENT
The main objectives of any programme of executive development are to :
1. Improve the performance of managers at all levels.
2. Identify the persons in the organisation with the required potential and prepare them for higher
positions in future.
3. Ensure availability of required number of executives / managers successsion who can take
over in case of contingencies as and when these arise in future.
4. Prevent absolescence of executives by exposing them to the latest concepts and techniques in
their respective areas of specialisation.
5. Replace elderly executives who have risen from the ranks by highly competent and
academically qualified professionals.
6. Improve the thought processes and analytical abilities.
7. Provide opportunities to executives to fulfill their career aspirations.
8. Understand the problems of human relations and improve human relation skills.

EXECUTIVE DEVELOPMENT:

It is also known as management development ‘or executive development ‘.

It is one of the fastest- developing areas in personnel. It is realized that an effective management
team may be as important to the survival of an organization as any tangible item on the balance
sheet.

Interest in management development is great partly due to the shortage of well-trained managers.

Executive development or management development is a systematic process of learning and

growth by which managerial personnel gain and apply knowledge, skills, attitudes and insights to
manage the work in their organization effectively and efficiently.

The program of executive development aims at achieving following purposes: -

 To sustain good performance of managers throughout their careers by exploiting their full
potential.

 To understand economic, technical, and institutional forces in order to solve business problems.

 To acquire knowledge about problems of human resources.

 To think through problems this may confront the organization now or in the future.

 To develop responsible leaders.

 To inculcate knowledge of human motivation and human relationships.

 To increase proficiency in management techniques such as work study, inventory control,

operations research and quality control.

Johnson and Sorcher write, ―Management development focuses on developing in a systematic

manner, the knowledge base, attitudes, basic skills, interpersonal skill sand technical skills of the
managerial

Executive development Program(EDP) is one such program. With Human resource making a
move from a welfare department to a strategic partner, more and more companies are
undertaking this program.

We at Career Solutions provide you the opportunity of developing a specific EDP for your
company. There are four major steps to be covered during the EDP-

1) Problem Assessment: the experts along with the concerned employees and CEO shall begin

with an assessment of the company‘s current problem and owner‘s plans of the future.

2) Management Audit and Appraisal: there shall be regular feedback sessions to check as to
whether we are reaching where we are supposed to reach.
3) Analysis of Development Needs: here the problem that has been uncovered shall be tried to
and remedied via a development program.

4) Identify Replacement Needs: the assessment may uncover a need to recruit and select new
management talent.

The format of EDP will vary with company‘s size and nature of operation so as to provide
optimum result.

 THE IMPORTANCE of executive DEVELOPMENT :

1.Change in organisations has become sine quo non with rapid changes in the total environment.

A manager, therefore, requires to be imparted training to abreast of and cope with ongoing
changes in his / her organisation.

Otherwise, the manager becomes obsolete. In this context, Dale yoder views that “without
training, the executives lose their punch and drive and they die on the vine.

Training and development are the only ways of overcoming the executive dropouts”.

2.With the recognition that managers are made not born, there has been noticeable shift from
owner managed to professionally managed enterprises, even in family business houses like Tata.
That is also indicated by the lavish expenditure incurred on executive training by most of the
enterprises these days.

3. Given the knowledge era, labour management relations are becoming increasingly complex.

In such situation, managers not only need job skills but also behavioural skills in union
negotiations, collective bargaining, grievance redressal, etc.

These skills are learned through training and development programmes.

4. The nature and number of problems change along with increase in the size and structure of
enterprise from small to large.
This underlines the need for developing managerial skills to handle the problems of big, giant
and complex organisations. Inaugurating the Tata Management Training Centre at Pune in 1965,
Mr. J.R.D Tata extolled the importance of management training in these words:

“Trained managers are vital to the economic development of the country...

This business of executive development has been one of the most crucial, essential end, at the
same time, one of the most difficult elements in providing continuity and efficient management”.

As regards the importance of management development, the renowned behavioural scientist

Peter Drucker opines that, “an institution that can not produce its own managers will die.

From an overall point of view, the ability of an institution to produce managers is more
important than its ability to produce goods effficiently and cheaply”.

In short, the importance of executive/ management development in an organisation can best be

put as: anything minus management development in an organisation mounts to nothing .

 THE IMPORTANCE of executive DEVELOPMENT

Executive development is more future oriented. It is more concerned with education than is
employee training.

In today ‘s competitive environment, an organization has to be concerned about the development

of supervisors, middle level managers and top-level executive.

Executive development is important for the following reasons: -

 Executive development programmes are required to train and develop professional managers.

 It helps managers to develop skills to face cut throat competition.

 It enables managers to face problems related to technology and institution.

 It helps in developing better relations with the labors.

 Executives need training and education to understand and adjust to changes in socio- economic
changes.

 Executive development is required to broader the outlook of managers.

 METHODS

Various methods/ techniques of executive/management development may be classified into two

broad categories

On-the-job methods

Coaching, Job Rotation, Understudy Assignments, Committee Assignments

Off -the-job methods

Lecture, Case Studies, Group Discussion, Transactional Analysis, Role Playing, Management
Games, Sensitivity Training, In-basket Exercise, Organisation Development

 Methods of executive development

Methods of development or executive development can be broadly divided into two categories.

1) On the job development or executive development: it means increasing the ability of the

executives while performing their duties, to develop them in real work situation. It includes the

following methods:

a) On the job coaching: under this method superior only guides his subordinate about various
methods and skill required to do the job. Here the superior only guides his subordinate he gives
his assistance whenever required.

The main purpose of this type of training is not only to learn the necessary skills but to give them
diversified knowledge to grow in future.

The superior is responsible for subordinate’s performance. So the superior must always provide
the subordinate necessary assistance whenever required.

b) Understudy: under this method of development the trainee is prepared to fill the position of
his superior.

He in the near future will assume to do the duties of his superior when he leaves the job due to
retirement, transfer or promotion.

c) Job rotation: here the executive is transferred from one job to another or from one plant to
other.

The trainee learns the significance of the management principles by transferring learning from
one

job to another.

This method helps in injecting new ideas into different departments of the organization.

d) Committee assignment: under this method committee is constituted and assigned a subject to

give recommendations.

The committee makes a study of the problem and gives suggestions to the departmental head.

It helps the trainees because every member of the committee gets a chance to learn from others.

2) Off the job development or executive development: here the executives gets the training off
the job means not when they are doing the job. It involves following methods:
a) Special courses: here the executives attend the special courses which are organized by the
organization.

Under this experts from professional institutions provide them the training.

Now days it is becoming popular but it is difficult to say whether these courses improve the
performance of the employees or not.

b) Specific readings: here the human resource development manager provides copies of specific

articles published in the journals to the executives to improve their knowledge.

The executives study such books or articles to enhance their knowledge.

c) Special projects: under this method the trainee is given a project related to the objective of
the

department. The project helps the trainee in acquiring the knowledge of the particular topic.

d) Conference training: here the organization conducts a group meeting. In which the executive

learn from the others by comparing his opinion with others.

e) Sensitivity training: it is also known as T group training or laboratory training. It is

conducted

under controlled conditions.

T group help in learning certain things, they help the participants to understand how group
actually work. It helps in increasing the tolerance power of the individual and ability to
understand others.

T group generally sits together and discuss for hours where the members learn about their own
behavior and behavior of others.
 METHODS OF EXECUTIVE DEVELOPMENT

Management development programs help in acquiring and developing managerial skill and
knowledge.

A Varity of methods of management development have come into prominence these days.

Different types of techniques are used to acquire and develop various types of managerial skill
and knowledge as given in the table below:

Competency Development Area Methods

1. Decision-making skill In-basket, Business games, Case study

2. Interpersonal skill Role plying, Sensitivity Training

3. Job Knowledge On-the-Job experiences, Coaching, Understudy

4. Organizational Knowledge Job Rotation, Multiple Management

5. General Knowledge Special course, Special Meeting, Specific

Reading

6. Specific Individual Needs Special Projects, Committee Assignments

The various techniques of executive development may be classified into two broad
categories:

1. On the Job Techniques: It is delivered to employees while they perform their regular jobs.

In this way, they do not lose time while they are learning. After a plan is developed for what
should be taught, employees should be informed of the details.

A time-table should be established with periodic evaluations to inform employees about their
progress.
On-the-job techniques include orientations, job instruction training, apprenticeships, internships
and assistantships, job rotation and coaching.

It consists of:-

 Coaching-Coaching is a one-to-one relationship between trainees and supervisors which

offers workers continued guidance and feedback on how well they are handling their tasks.

The coach assigns the task, monitors the trainee behavior, and provides reinforcement and
feedback.

Coaching is commonly used for all kinds of trainees, from unskilled to managerial position.

This method is critically depends on the quality of the coach.

 Under Study- An understudy may be assistant to someone or special assistant to some

supervisory or executive positions.

He learns by experience, observation, guidance and coaching.

 Position Rotation-This involves the movement of the trainee from one job to another.

This helps him to have a general understanding of how the organization functions.

A part from releasing boredom, Job rotation allows workers to build rapport with a wide range of
individuals within the organization, facilitating future cooperation among various departments.

Such cross-trained personnel offer a great deal of flexibility for organizations when transfers,
promotions or replacement become inevitable.

 Multiple Management- It provides knowledge about the organization to the junior and middle

managerial personnel.

Here the members are exposed to all types of the decision taken at higher level.
2. Off-the-Job Technique: It consists of:

 Lectures- It is a traditional and direct method of instruction.

The instructor organizes the material and gives it to a group of trainees in the form of a talk.

To be effective, the lecture must motivate and create interest among the trainees.

An advantage of this method is that it is direct and can be used for a large group of trainees.

The major limitation of this method is that it does not provide for the transfer of training
effectively.

 Case Studies- It presents the trainees with a written description of a business or org problem.

The object of the case method is to teach the trainees how to analyze information, generate
alternative decisions, and evaluate the alternatives.

Cases can be analyzed by individuals or small groups.

Feedback and reinforcement are provided through oral discussion or written comments from the
instructor.

 Group Discussions- This method is a direct discussion on a specific topic conducted with a
relatively small group of trainees.

This method is useful for teaching and exploring difficult conceptual materials, and for changing
attitudes and opinions.

It provides opportunity for feedback, reinforcement practice, motivation, and transfer, largely
due to the active interchange of ideas between the participants.

 Role Playing- In most of role-playing assignments, each of the student takes the role of a
person affected by an issues on human life and effect the human activities all around us from the
perspective of that person.
 Management Games- Verities of business and management games have been devised and are
being used with the varying degree of success in the developing programmes.

A management game is classroom exercise in which a number of team of trainees competes

against

each other to achieve certain objectives.

 Sensitivity Training- It has been successfully employed by behavioral scientists over the past
thirty years.

Sensitivity to the circumstances and feeling of others is the cornerstone of human relationships.

It is important to note that sensitivity is not just an emotion; it must express itself in actions as
well, especially when people we know are experiencing pain and difficulties.

 MANAGEMENT DEVELOPMENT METHOD- Besides the cognitive and behavioural

method, there is another method which is known as management development method.

The method emphasizes more on making the employees a better performer by educating them
through the process of training.

Management development method is further divided into two parts:

(a) On the job training: The method is based on the fact that it is possible to develop the
abilities of an employee in its job place itself.

The four techniques for on-the job development are:

1. COACHING

2. MENTORING
3. JOB ROTATION

4. JOB INSTRUCTION TECHNIQUE (JIT)

1. Coaching: In this method gives the employee an opportunity to receive feedback from an
expert that helps in identifying their weaknesses and accordingly the way to rectify these.

2. Mentoring: In contrast of Coaching, Mentoring means an ongoing informal relationship that

usually develops between a senior and junior employee. That means here the senior performs the
role of a guide to his junior employees.

3. Job rotation: Job rotation means the intentional changing of job position of employees within
a department, division or organization etc.

4. Job instruction technique (jit): Job Instruction Technique (JIT) uses a strategy with a focus
on the development of knowledge (factual and procedural), skills and attitudes of trainees.

(b) OFF THE JOB TRAINING : There are many management development techniques that an
employee can take in off the job. The few popular methods are:

1. SENSITIVITY TRAINING

2. TRANSACTIONALANALYSIS

3. LECTURES

4. SIMULATION EXERCISES

1. Sensitivity training: In this method it is tried to develop the social sensitivity and behavioral
flexibility in the people so that in return they are able to understand themselves and others
reasonably.

2. Transactional analysis: Transactional Analysis provides trainees with a realistic and useful
method for analyzing and understanding the behavior of others.
Learning from psychology are used in this method by trained experts in order to help the trainees
to understand themselves better.

3. Lectures: In this method, the trainer speaks to a group of people about a topic without
involving any kind of interaction between him and the trainees.

Benefits:

 Increased job satisfaction and morale among employees

 Increased employee motivation

 Increased efficiencies in processes, resulting in financial gain

 Increased capacity to adopt new technologies and methods

 Increased innovation in strategies and products

 Reduced employee turnover

 Enhanced company image, e.g., conducting ethics training

 DIFFERENCE BETWEEN TRAINING AND DEVELOPMENT

 Training often has been referred to as teaching specific skills and behaviour.

It is usually reserved for people who have to be brought up to performing level in some specific
skills.

The skills are almost always behavioural as distinct from conceptual or intellectual.

Development: It refers broadly to the nature and direction of change induced in employees,
particularly managerial personnel, through the process of training and education.

Development is considered to be more general than training and it is aimed towards management
people.
Usually the intent of development is to provide knowledge and understanding that will enable
people to carry out non-technical organisational functions more effectively, such as problem-
solving, decision-making and relating to people.

 Training is a short-term process utilizing a systematic and organized procedure by which

non-managerial personnel learn technical knowledge and skills for a definite purpose.

Development is a long-term educational process utilizing a systematic and organized procedure

by which managerial personnel learn conceptual and theoretical knowledge for general purposes.

 Thus, training is meant for operatives and development is meant for managers.
 Training tries to improve a specific skill relating to a job, whereas development aims at
improving the total personality of an individual.
 Training is a one shot-deal whereas development is an ongoing, continuous process.
 Training is a result of outside motivation, whereas development is mostly a result of internal
motivation.
 Training seeks to meet the current requirement of the job, whereas development seeks to
meet the future needs of the individual and job.
 Thus training is a reactive process, whereas development is a proactive process.

QUE NO: DEFINITION OF HRD

Human Resource Development can be defined as a set of inter-related activities, by which

human potentialities’ are assessed, selectively upgraded and appropriately deployed for
achievement of envisioned goals, which foster human dignity.

According to Leonard Nadler, “HRD is organized learning experiences in a definite time period
to increase the possibility of improving job performance and growth”

K.C. Gupta in his research paper HRD is organization concept & Mechanism states, “HRD
means safeguarding, maintaining, and improving existing skills of human beings (i.e. human
resources) so as to increase their productivity for ultimate wellbeing of organizations as well as
their own.”

OBJECTIVES OF HUMAN RESOURCE DEVELOPMENT

Bhattacharya stated objectives of HRD as

1. “To develop capabilities of each individual in an organization in relation to his/her present role.

2. To develop capabilities of each individual in relation to his/her future role.

3. To develop better interpersonal and employer-employee relationship in an organization.

4. To develop team spirit.

5. To develop coordination among different units of an organization.

6. Facilitate organization to utilize human resources effectively by providing them training and
orientation.

7. Help manpower planning and prevent over staffing

8. Provide opportunity for staff as career advancement path.

9. It helps to increase motivation level of staff.

10. To develop organizational health by continuous renewal of individual capabilities and

keeping pace with the technological changes.

THERE ARE CERTAIN OBJECTIVES FOR IMPLEMENTING HRD IN ANY

ORGANIZATION WHICH AIMS AT DEVELOPING (RAO: 2005):

the capabilities of each employees as individuals;

the capabilities of each individual employee in relation to his/her present job;

the capabilities of each individual employee in relation to his/her expected future role;

the superior-subordinate (dyadic) relationship;

a cohesive and congenial atmosphere of working;

collaboration among different units of an organization;

to develop the constructive mind and overall personality of employees;

the organization’s overall health and self-renewing capabilities which in turn increase the
organizational capabilities in a comprehensive manner;

to humanize the work in an organization; and

to ensure better quality work, higher productivity and higher profits.

QUE NO: HRD NEED FOR HRD

HRD is necessary for any type of organization for:

- Stability and Survival of the organization,

- Building individuals and strengthening the organization.

- Change with diversification in modern era;

- Retuning activities to greater effectiveness;

- Providing the best or highest quality in all the organization’s goods and services;

- Being a leader in its field; and

- Obtaining goodwill and reputation through customer delight and satisfaction. (Dhiman and
Rani, 2005).
3.8.1 TO DEVELOP COMPETENCIES

Organizations have progressed because they have developed the competencies of their people.
Enhancing capabilities, skills and empowering the engaged employees brings in efficiency.

3.8.2 ORGANIZATION-WIDE CHANGES

Changes are required in all aspect of organization functioning and should be interrelated.

Development of competencies among people in the organization is not enough for their
effectiveness but there also must be change in those factors which affect the use of those
competencies.

Therefore, changes are required in other aspects of organizational functioning.

The McKinsey model spells out these aspects in an organization through the 7 S model. [This is
called McKinsey 7-S Structure]. (Peters and Waterman, 1982)

3.8.3 TO CREATE CONDUCIVE ORGANIZATIONAL CLIMATE

HRD attempts to create organizational climate conducive to individual growth as well as

organizational growth.

The needs today are competent professionals having abundant business knowledge and
comfortable with technology.

As a strategic business partner HR has to create an organization climate conducive for growth.

Therefore in order to ensure high-end engaged employees and minimize attrition, they need
create a corporate culture high on value and trust that would define the organization.

Career mapping is essential. Creating more hierarchical levels so that promotional avenues exist,
and so on, will be only dysfunctional.

Instead, the contemporary practices are based on flexibility and a tailor-based system.
HRD attempts to build this kind of climate.

Though there are no comprehensive research studies which can conclusively prove whether HRD
systems have been able to fulfill the above need and requirements, some conclusions which can
be enumerated with learnings are:

Performance appraisal being an integral part of any organization, engaged and output-oriented
human resources needs high incentive for continual performance be it rewards, monetary or non-
monetary.

Conducive culture increases efficiency and cooperation amongst all. It is the responsibility of the
HR department to be sensitive to the problems of all employees and create solutions to ensure
high morale and motivated employees in the interest of the organization.

 EMERGENCE/NEED OF HRD

Since human resources is the life line of an organization and the process of developing this
resource is highly significant for the managers to achieve the goals and targets of the
organization.

Therefore, HRD is needed by any organization that wants to be dynamic and a survivor in the
present scenario of cut-throat competition.

In the rapidly changing environment, organizations can scale new heights only through the
effective and efficient use of human resources (Deb: 2010).

To keep the pace with the ever changing environment, organizations must develop its people and
allow them to grow.

HRD system must be viewed as a total system interacting with other systems of an organization.

Therefore need of HRD arises to improve working life, to develop potential of employees and
utilizing the human resource in an optimum manner to exploit their potential by availing
opportunities for further development and growth.
In a nutshell, HRD is needed because:

ƒ It is helpful in creating a congenial environment and improves the working life of human
resource,

ƒ It helps in facilitating effective communication to surface creative ability of employees in full

swing,

ƒ It enables the members to attain self-actualization through systematic process of development,

ƒ It facilitates tapping the present and future creative abilities of the people to utilize them for
organizational development.

ƒ It is helpful in accelerating the growth of employees and making them aware about their
strengths and weaknesses,

ƒ It is helpful in developing the skills of work force in a way to make them competent enough to
exploit the available opportunities in an optimum manner (Sheikh: 2009).

 NEED OF HRD

HRD is needed by any organisation that wants to grow continuously. In the fast changing

environment, organisations can scale new heights only through the effective and efficient use of

human resources.

Appropriate personnel policies help maintain employee motivation and morale at a high level,
but this alone may not help the organisation achieve success and venture into new fields.

To this end, employee capabilities must be continually trained, developed and expanded.

The employees must be encouraged to take risks, experiment, innovate and make things happen
in an atmosphere of mutual trust, goodwill and cooperation.
"People need competencies to perform tasks. Higher degree and quality of performance of tasks
requires higher level or degree of skills.

Without continuous development of competencies in people, an organisation is not likely to

achieve its goals.

Competent and motivated employees are essential for organisational survival, growth and
excellence" (IGNOU, MS 22, p.6).

HRD IS NEEDED IN AN ORGANISATION BECAUSE:

1. HRD improves the capabilities of people. They become innovative and enterprising - ever
eager to take risk and get ahead.

It improves the all-round growth of an employee.

Feedback and guidance from superiors help employees grow continually and show superior
performance.

2. HRD improves team work. Employees become more open and trust each other.

The organisational climate, too, improves a lot.

3. HRD leads to greater organisational effectiveness. Appropriate employee-centered policies

help the organisation achieve its goals more efficiently.

4. Performance related rewords help employees realise the importance of utilising their

skills fully in the service of organisational goals.

The organisation's overall health and self-renewing capabilities, too, improve quite significantly.

 For any dynamic and growth-oriented organisation to survive in a fast-changing environment,

HRD activities play a very crucial role.

Training, retraining and redeployment have now become buzzwords in corporate circles as
market globalisation (which is an outcome of the economic restructuring programme),
delicensing and free flow of technology (as per New Industrial Policy of July, 1991), and
intensified competition are rendering traditional skills and knowledge redundant.

Many organisations in India are now threatened with manpower obsolescence.

To withstand this, HRD activities have now received prime importance.

Increased morale and motivation of employees no doubt are necessary to achieve productivity
and

functional effectiveness.

But these alone cannot sustain a dynamic organisation, unless effort and competencies of human
resource are renewed constantly, developing an enabling organisational culture.

An enabling organisation culture is possible when employees of an organisation are found

to use their initiative, take risks, experiment, innovate and make things happen.

Hence, role and significance of HRD in an organisation can be appreciated when we consider the

fast-changing environment coupled with technological change and intensified competition.

This has necessitated the need for renewal of capabilities of people working in the organisation

which are simultaneously reinforced by changes in the organisation by the Organisational

Development (OD) process.

The role and significance of HRD can further be appreciated when we consider different systems

of HRD like performance appraisal, career planning and development, manpower planning,

management succession and development, training (which includes the role of education and
development discussed earlier), Organisational Development (OD), Quality of Work Life (QWL),

etc.

QUE NO: HRD INTERVENTION :- INTRODUCTION

HRD programs and interventions can be used to address a wide range of issues and problems in
an organization.

They are used to orient and socialize new employees into the organization, provide skills and
knowledge, and help individuals and groups to become more effective.

To ensure that these goals are achieved, care must be taken when designing and delivering HRD
programs.

FRAMEWORK FOR THE HRD PROCESS

The goal of HRD is to improve an organization’s effectiveness by:

1. Solving current problems (like an increase in customer complaints)

2. Preventing anticipated problems (such as a shortage of skilled technicians)

3. Including those individuals and units that can benefit most as participants

In short, HRD is effective if it successfully addresses some organizational needs through

conducting needs assessments.

Designing HRD interventions involves a process, which includes a four-step sequence: needs
assessment, design, implementation, and evaluation. (Figure)
Phase I Phase II Phase III Phase IV

Assessment Design Implementation Evaluation

NEEDS ASSESSMENT PHASE

HRD interventions are used to address some need or “gap” within the organization.

A need can be either a current deficiency, such as poor employee performance, or a new
challenge that demands a change in the way the organization operates (new legislation or
increased competition).

Identifying needs involves examining the organization, its environment, job tasks, and
employee performance.
This information can be used to:

➢ Establish priorities for expanding HRD efforts

➢ Define specific training and HRD objectives

➢ Establish evaluation criteria

DESIGN PHASE

The second phase of the training and HRD process involves designing the HRD program or
intervention.

If the intervention involves some type of training or development program, the following
activities are typically carried out during this phase:

➢ Selecting the specific objectives of the program

➢ Developing the appropriate lesson plan for the program

➢ Developing or acquiring the appropriate materials for the trainees to use

➢ Determining who will deliver the program

➢ Selecting the most appropriate method or methods to conduct the program

➢ Scheduling the program

Once the assessment phase is completed, it is important to translate the issues identified in
that phase into clear objectives for HRD programs.

This should also facilitate the development of clear lesson plans concerning what should be
done in the HRD program.
Selecting the proper person to deliver the HRD program is also an important decision, and
it can be difficult, depending on the resources available.

If the organization employs a group of full-time HRD professionals, the choice will depend
largely on the expertise and work schedules of those professionals.

However, if the organization does not have the HRD staff, it will have to rely upon other
people, including managers, supervisors, coworkers, or outside consultants.

Using such individuals raises a host of issues, including their willingness, ability, and
availability to train, as well as cost issues.

The design phase also involves selecting and developing the content of the program.

This means choosing the most appropriate setting for the program (e.g., on the job, in a
classroom, online, or some combination), the techniques used to facilitate learning (such as
lecture, discussion, role play, simulation), and the materials to be used in delivering the
program (such as workbooks, job aids, web-based or web-enhanced materials, films, videos,
Microsoft® PowerPoint® presentations, etc.).

Inherent in these decisions is the issue of whether to develop the program in-house or
purchase it (or parts of it) from an outside vendor.

Scheduling the program may not be as easy as it appears. Issues to be resolved include lead
time to notify potential participants, program length and location, covering participants’
regular job duties, and potential conflicts (such as vacations, busy periods, and facility
availability).

The needs assessment may also reveal that training is not the ideal solution for the issues
or problems facing the organization.

It may be that some management practice needs to be changed, or that changes need to be
made in another human resource practice (such as staffing or compensation).
It may also be the case that a different type of HRD intervention is called for besides
training, for example, a change in the organization of work, or a change in the focus on total
quality or process reengineering.

Such HRD interventions would not require a “lesson plan.” However, other design issues
occur with career management and organizational development interventions.

IMPLEMENTATION PHASE

The goal of the assessment and design phases is to implement effective HRD programs or
interventions.

This means that the program or intervention must be delivered or implemented, using the
most appropriate means or methods (as determined in the design phase).

Delivering any HRD program generally presents numerous challenges, such as executing
the program as planned; creating an environment that enhances learning, and resolving
problems that may arise (missing equipment, conflicts between participants, etc.).

EVALUATION PHASE

Program evaluation is the final phase in the training and HRD process.

This is where the effectiveness of the HRD intervention is measured.

This is an important but often underemphasized activity.

Careful evaluation provides information on participants’ reaction to the program, how

much they learned, whether they use what they have learned on the job, and whether the
program improved the organization’s effectiveness.

HRD professionals are increasingly asked to provide evidence of the success of their efforts
using a variety of “hard” and “soft” measures, that is, both bottom line impact, as well as
employee reaction.
This information allows managers to make better decisions about various aspects of the

HRD effort, such as:

➢ Continuing to use a particular technique or vendor in future programs

➢ Offering a particular program in the future

➢ Budgeting and resource allocation

➢ Using some other HR or managerial approach (like employee selection or changing

work rules) to solve the problem

It is important that HRD professionals provide evidence that HRD programs improve
individual and organizational effectiveness.

Armed with this information, HRD managers can better compete with managers from other
areas of the organization when discussing the effectiveness of of their actions and
competing for organizational resources.

Performance Appraisal: Objectives - Uses and Methods: Traditional and Modern methods
(360 & 720 Degree KRI, KPI) - Balanced Score Card system - Barriers of Performance
Appraisal - Career Planning - Succession planning and Competency Mapping and
development.

QUE NO 7: PERFORMANCE APPRAISAL

According to Flippo, “performance appraisal is the systematic, periodic and an impartial rating
of an employee’s excellence in matters pertaining to his present job and his potential for a better
job”.
To Beach, “performance appraisal is the systematic evaluation of the individual with regard to
his or her performance on the job and his potential for development”.

Definition: “performance appraisal includes all formal procedure used to evaluate personalities
and contributions and potentials of group members in a working organization.”..Dale yoder.

“Performance appraisal is a process of evaluating an employee’s performance of a job in terms

of its requirements.”…Scot, clothier and Spiegel.

What is a performance appraisal?  performance appraisal (PA), also referred to as a

performance review, performance evaluation, (career) development discussion, or employee
appraisal is a method by which the job performance of an employee is documented and evaluated.
Performance appraisals are a part of career development and consist of regular reviews of
employee performance within organizations.

General Definition According to Newstrom, “It is the process of evaluating the performance of
employees, sharing that information with them and searching for ways to improve their
performance’’.

QUE NO 8: OBJECTIVES OF PA

1. Compensation Decision: It can serve as a basis for pay raises. This approach to compensation
is at the heart of the idea that raises should be given for merit rather than for seniority.

2. Promotion Decision: It can serve as a guide for job change or promotion.

3. Training and Development Programme: PA can inform employees about their progress and
tell them what skills they need to develop to become eligible for pay raises or promotions or both.

4. Feedback: It can tell an employee what he can do to improve his present performance and go
up the organizational ladder.

5. Personal Development: It can help reveal the causes of good and poor employee performance.

 OBJECTIVES OF THE PERFORMANCE APPRAISAL:

1. To improve the job performance of employees and also to identify there development
potentialities.

2. To diagnose the strength or weakness of individuals so as to access the area in which training
is required.

3. To prevent grievance and un disciplinary activities of the personnel.

4. To evaluate the success of training programmes

5. To motivate the employee to perform well.

6. To provide coaching, counseling and career planning to employees.

7. To test the effectiveness of recruitment, selection, placement and rotation process.

8. To facilitate research in personnel management.

9. To establish harmonious relationship between employer and employees.

10. To provide valid information for deciding promotion, transfer, placement, punishment,etc.

OBJECTIVES : The objectives of performance appraisal are as follows:

1. Salary increase:

Performance appraisal plays a role in making decision about salary increase. Normally salary
increase of an employee depends on how he is performing his job.

The hike in salary to different employees may be according to their efficiency and ranking.

2. Promotion

Performance appraisal plays a role in making decision about promotion. Normally internal
promotion of an employee depends on how he is performing his job.
There is continuous evaluation of his performance either formally or informally.

Most of the organizations often use a combination of merit and seniority for promotion.
Performance appraisal precedes promotion decision.

3. Training and Development

Performance appraisal tries to identify the strengths and weaknesses of an employee on his
present job.

This information can be used for devising training and developing programmes appropriate for
overcoming weakness of the employees.

In fact, many organisations use performance appraisal as means for identifying training needs of
employees.

4. Feedback

Performance appraisal provides feedback to employees about their performance.

It tells them where they stand. A person works better when he knows how he is working, how his
efforts are contributing to the achievement of organsiational objectives.

Besides, if they know their weakness, they will try to overcome them.

5. Pressure on employees

Performance appraisals puts a sort of pressure on employees for better performance.

If the employees are conscious that they are being appraised in respect of certain factors and their
future largely depends on such appraisal, they tend to have positive and acceptable behaviour in
this respect.

Thus, appraisal can wok automatically as a control device.

QUE NO 9: USES

Performance appraisal is broadly used for meeting the following purposes :

1. To indentify employees for salary increases, promotion, transfer and lay-off or

termination of services.
2. To determine training and development needs of the employees.
3. To motivate employees by providing feedback on their performance levels.

4. To establish a basis for research and reference for personnel decisions in future.

 PERFORMANCE APPRAISAL PROCESS:

1. Setting the performance standards:

The first step in the process of performance appraisal is setting up of the standards which will be
used as a benchmark to compare actual performance of the employees.

This step requires setting the performance criteria to judge performance of the employees as
successful or unsuccessful of the degrees.

To be useful standards should relate to the desired result of each job.

The standards set should be clear, easily understandable and in measurable terms.

In case the performance of the employee cannot be measured, great care should be taken to
describe the standards.

2. Communicating the standards:

There are two parties involved in performance appraisal: appraiser and appraisee.

Appraiser is one who does the appraisal and the appraisee is the one whose performance is
evaluated.
An appraisee should be informed the standards .This will help them to understand their roles and
to know what exactly is expected from them.

The standards should also be communicated to the appraisers or the evaluators and if required,
the standards can also be modified at this stage itself according to the relevant feedback from the
employees or the evaluators.

3. Measuring the actual performance:

The most difficult part of the performance appraisal process is measuring actual performance of
the employees i.e. the work done by the employees during a specified period of time.

It is a continuous process which involves monitoring the performance throughout the year.

This stage requires careful selection of the appropriate techniques of measurement such as
personal observation, statistical reports, and written reports for measuring the performance.

4. Comparing actual performance with desired performance:

At this stage, actual performance is compared with the desired performance or performance
standards. Comparison reveals deviations in the performance of the employees from set
standards.

This comparison can show actual performance being more than the desired performance or,
actual performance being less than the desired performance.

It includes recalling, evaluating and analysis of data related to the employees’ performance.

5. Providing feedback:

Result of the appraisal is communicated and discussed with the employees on one-to one basis.
The focus of this discussion is on communication and listening. The results, problems and
possible solutions are discussed, with the aim of problem solving and reaching consensus.

The feedback should be given with a positive attitude as this can have an effect on the
employees’ future performance.

The purpose of a meeting should be to solve the problems faced and motivate the employees to
perform better.

Taking corrective action:

The last step of the process is to take decisions corrective action to overcome the deficiencies or
the related HR decisions like rewards, promotions, demotions, transfers etc.

PERFORMANCE APPRAISAL PROCESS –

Establish Performance Standards

Communicate performance expectations to employees

Measure actual performance

Compare actual performance with standards

Discuss the appraisal with employees

If necessary, initiate corrective action

The evaluation process passes through a series of actions as mentioned below:

1. Establish Performance Standards- This is the first step and an important step.

In this step, performance standards should be determined. These should be clear, understood and
measured. These should be discussed with the supervisors because he can give the points to each

factor and these then should be indicated on the appraisal form.

2. Communicate performance expectations to employees- The performance standards should be

communicated to the employees for their feedback.

3. Measure actual performance- In this step, the actual performance is measured.

To measure this performance, four sources of information are frequently used i.e. personal

observation, statically reports, oral reports and written reports.

4. Compare actual performance with standards- The employee is appraised and judged of his

potential for growth and advancement.

Attempts are made to not deviations between ‘standard performance’ and ‘actual performance.’

5. Discuss the appraisal with the employee- The supervisor discusses the result of appraisal

periodically with the employees.

The information that the subordinate receives about his assessment, has a great impact on his
self-esteem and on his subsequent performance.

6. If necessary, initiate corrective action- This initiative for corrective action is taken when it is
necessary.

QUE NO 10: TRADITIONAL & MODERN METHODS (360 & 720 DEGREE KRI, KPI)

TRADITIONAL METHODS OF PERFORMANCE APPRAISAL

1. Essay Appraisal Method:

In essay appraisal, appraiser rates the employee in an open-ended manner and put down his
impressions about the employee on a continuous basis.

These impressions relate to strong and weak points of the employee‘s behaviour.

He takes note of these factors:

 Job knowledge and skills exhibited by the appraisee while performing his job

 Appraisee’s relationship with the employees and manager

 Appraisee’s personality traits and attitude towards his job, peers, manager and the organisation.

 Appraisee’s understanding and commitment to organization’s goals and objectives and

 Appraisee’s potential for organisational future roles.

It is the simplest evaluating method in which evaluator writes an explanation about employee’s
strength and weakness points, previous performance, positional and suggestions for his (her)
performance improvement at the end of evaluation term.

This kind of evaluations usually includes some parts of other systems to cause their flexibility.

2. Grading:

In this technique, the rater considers certain features and marks them according to a scale.

The selected features may be analytical ability, cooperativeness, dependability, self-expression,

job knowledge, leadership and organizing ability.

These may be graded as e.g. A-Outstanding, B-Very good, C- Average, D-Fair, E-Poor and F-
Very poor.

The actual performance of an employee is then compared with these grades and he is allotted the
grade which best describes his performance.

Ranking Method:

Under this method, superior ranks his subordinates in order of their merit, starting from the best
to the worst.
The relative position of each employee is expressed in terms of his numerical rank.

In this type of appraisal, individuals are ranked from highest to lowest.

It is assumed that the difference between the first and second employee is equal to difference
between first and 2nd employee.

In this method, the manager compares each person with others than work standards

4. Checklist Method:

In this method, the evaluator has a list of situations and statements and compares it with
employees.

The checklist is a presentation of employee’s characteristics and performance.

The results can be quantitative and give weight to characteristics.

The advantages of as checklist are economy, ease of administration, limited training of rater, and
standardization.

The disadvantages include susceptibility to rater’s biases (especially the halo effect), use of
personality criteria instead of performance criteria, misinterpretation of checklist items, and the
use of improper weights by the HR department.

Another disadvantage of this approach is that it does not allow the rater to give up relative
ratings.

5. Rating Scales:

This is the simplest and the most popular technique for appraising employee performance; the
typical rating-scale system consists of several numerical scales, each representing a job-related
performance criterion such as dependability, initiative, output, attendance, attitude, co-operation,
and the like.

Each scale ranges from excellent to poor. The rater checks the appropriate performance level on
each criterion, and then computes the employee’s total numerical score.

The number of points scored may be linked to salary increases, whereby so many points equal a
rise of some percentage.

Rating scales offer the advantages of adaptability, relatively easy use and low cost. Nearly every
type of job can be evaluated in a short time, and rater does not need any training to use the scale.
The disadvantages of this method are several. The rater’s biases are likely to influence evaluation,
and the biases are particularly pronounced on subjective criteria such as cooperation, attitude and
initiative.

Critical Incident Method:

It focuses on key factors which make difference in performing a job efficiently. This method is
more credible because it is more related to job and based on individual’s performance than
characteristic.

The necessity of this system is to try to measure individuals’ performance in term of incidents
and special episodes which take place in job performance.

These incidents are known as critical incident. In this method, the manager writes down the
positive and negative individuals’ performance behavior in evaluation term (Mondy, 2008).

The critical incidents method of employee assessment has generated a lot of interest these days.

The approach focuses on certain critical behaviors of an employee that make all the difference
between effective and non-effective performance of a job. The supervisors record such incidents
as and when they occur.

Behaviourally anchored rating scale:

This method is combination of the rating scale and critical incident techniques of performance
appraisal. It is a tool that anchors a numerical rating scale with specific behavioural examples of
good or poor performance.

Behaviorally Anchored Scales, sometimes called behavioral expectation scales, are rating scales
whose scale points are determined by statements of effective and ineffective behaviors.

They are said to be behaviorally anchored in that the scales represent a range of descriptive
statements of behavior varying from the least to the most effective.

A rater must indicate which behavior on each scale best describes an employee’s performance.

ARS have five stages (Decenzo, 2002):

1) Generate Critical Incidents

2) Develop performance dimensions,

3) Relocate incidents,
4) Rating of level of performance for each incident and

5) Development of the final instrument.

Forced Choice Method:

In this, the rater is given a series of statements about an employee. These statements are arranged
in blocks of 2 or more, and the rater indicates which statement is most or least descriptive of the
employee. Typical statements are:

1. Learns fast____________________________works hard

2. Work is reliable________________________performance is a good example for

3. Absents often__________________________others usually tardy.

As in the checklist method, the rater is simply expected to select the statements that describe the
rate. Actual assessment is done by the HR Department.

This approach is known as the forced choice method because the rater is forced to select
statements, which are readymade.

The advantage of this method is the absence of personal bias in rating.

The disadvantage is that the statements may not be properly framed – they may not be precisely
descriptive of the ratee’s traits.

Paired Comparison Method:

In this method, the appraiser compares each employee with all others in a group one at a time.

After all the comparisons, on the basis of the overall comparisons, the employees are given the
final rankings.

Under this method the appraiser compares each employee with every other employee one at a
time.

For example there are five employees named A, B, C, D and E.

The performance of A is first compared with the performance of B and a decision is made about
whose performance is better.

Then A is compared with C. D and E in that order.

The same procedure is repeated for other employees. The number of comparisons may be
calculated with the help of a formula which reads thus: N (N-1)/ 2

where N stands for the number of employees to be compared.

If there are 10 employees, the number of comparisons will be 10(10-1)/2 = 45.

After the completion of comparison, the results can be tabulated and a rank is created from the
number of times each person is considered to be superior.

MODERN METHODS OF PERFORMANCE APPRAISAL

1. Assessment Centre:

An assessment centre typically involves the use of methods like social/informal events, tests and
exercises, assignments being given to a group of employees to assess their competencies to take
higher responsibilities in the future.

Generally, employees are given an assignment similar to the job they would be expected to
perform if promoted.

This review of potential is concerned with forecasting the direction in which an individual’s
career should go and the rate at which he is expected to develop.

The trained evaluators observe and evaluate employees as they perform the assigned jobs and are
evaluated on job related characteristics.

The major competencies that are judged in assessment centres are interpersonal skills,intellectual
capability, planning and organizing capabilities, motivation, career orientation etc. assessment
centres are also an effective way to determine the training and development needs of the targeted
employees.

2. Management by Objectives:

MBO (or management by objectives) is a technique credited to management guru Peter Drucker,
to describe a method of performance management that is based on the setting of clear and
measurable objectives, and the use of those objectives to evaluate and review performance.

When done correctly, MBO is probably the best and fairest way to plan for and create effectively
performing employees.
The principle behind Management by Objectives (MBO) is to make sure that everybody within
the organization has a clear understanding of the aims, or objectives, of that organization, as well
as awareness of their own roles and responsibilities in achieving those aims.

The complete MBO system is to get managers and empowered employees acting to implement
and achieve their plans, which automatically achieve those of the organization.

MBO AS A GOAL SETTING AND APPRAISAL PROGRAMME CONSISTS OF SIX STEPS:

1. Setting organisational goals: Based on firm’s strategic plan establish

organisational plan for next year, and from this set company’s goals.

2. Set departmental goals: Departmental heads take these company goals and with

their superiors jointly set goals for their departments.

3. Discuss departmental goals: Departmental heads discuss departmental goals

with their subordinates. They ask the subordinates to set their individual goals.

4. Define expected results: Departmental heads and their subordinates set short

term individual performance targets.

5. Performance reviews: Departmental heads compare each employee’s actual and

targeted performance.

6. Provide feedback: : Departmental heads and employee discuss and evaluate the

latters’ progress

3. Human Resource Accounting Method:

Human resources are valuable assets for every organization. Human resource accounting method
tries to find the relative worth of these assets in the terms of money.

In this method the performance appraisal of the employees is judged in terms of cost and
contribution of the employees.
The cost of employees include all the expenses incurred on them like their compensation,
recruitment and selection costs, induction and training costs etc whereas their contribution
includes the total value added (in monetary terms).

The difference between the cost and the contribution will be the performance of the employees.

Ideally, the contribution of the employees should be greater than the cost incurred on them.

4. 360 degree Feedback:

360 degree feedback is also known as 'multi-source feedback.

First developed at General Electric, US in 1992, the system has become popular in our country
too.

360 degree Feedback is systematic collection of performance data on an individual or group from
a number of sources.

The sources are immediate supervisors, peers, customers, self.

Having collected data from these sources 360 degree feedback provides broader perspective
about employee performance.

The 360-degree evaluation can help one person be rated from different sides, different people
which can give the wider prospective of the employee’s competencies (Shrestha, 2007). It has
been used for human resource development, appraisal and pay decisions (Stone, 2002).

5. Computerized and Web based performance appraisal:

Nowadays, several performance appraisal software programmes are available.

These software programmes enable managers to keep computerized notes on subordinates during
the year, and then to combine these with ratings of employees on several performance traits.

The software programmes then generate written text to support each part of the appraisal.

In the traditional Appraisal system, the paper based appraisal causes a lot of manual work, which
is time consuming, not secure and difficult to nalyse the performance.

Whereas Web based performance appraisal provides an easy way to conduct appraisal.
 MANAGEMENT BY OBJECTIVES (MBO)

The term ‘management by objectives’ (MBO) was first coined by Peter Druckerin 1954.

Basically, Drucker tried to attach MBO level to result-oriented evaluations.

He proposed MBO as means of using goals to motivate people rather than to control them.

Management by objectives can simply be defined as a programme that encompasses specific

goals, participatively set, for an explicit time period, with feedback on goal progress.

Accordingly to Odiorne “MBO is a process whereby the superior and subordinate managers

of an organisation jointly identify common goals, define each individual’s major areas of

responsibilities in terms of the results expected of him, and use these measures as guides for

operating the unit and assessing the contribution of each of its members”.

MBO provides specific objectives for each succeeding level (i.e., divisional, departmental,

individual in the organisation).

An MBO progamme or process consists of four common ingredients.

These are: specificity, pariticipative decision making, an explicit time period, and performance

feedback.

A breif description of these follows.

1. Specificity: The objective in MBO should be clear and precise that can be measured and

evaluated. To state a desire to cut costs, for example ,may not be enough. Instead, to cut costs by

per cent will be more clear. Exact and measurable objective.

2. Participative Decisions / Objectives: In MBO goals are not imposed on people. The superior

and subordinate jointly set objectives to be attained.

3. Explicit Time: Each objective is to be completed within a specific time period, be it three

months, six months or a year.

4. Performance Feedback: The final ingredient in MBO programme is feedback on

performance.

It includes continuous and systematic measurement and review of performance. Based on these,

Corrective actions are taken to achieve the planned objectives.

Advantages of MBO

Following are the advantage of MBO:

1. The need to clarify objectives is stressed and suggestion for improvement are obtained from

all levels of management.

2. All managers have a clear idea of the important areas of their work and of the

standards required.

3. The performance of staff can be assumed and their needs for improvement highlighted.

4. Greater participation may improve morale and communication.

5. It makes individuals more aware of organisational goal.

Disadvantages of MBO

MBO suffers from the following disadvantages also:

1. It takes a few years to be effective.

2. Some companies always tend to raise goals. If these are too high, employees become
frustrated.

3. Appraisals are sometimes made on personality traits rather than on performance.

4. Some employees do not want to be held responsible and goals forced upon them may lead

to ill-feeling.
 METHODS OF PERFORMANCE APPRAISAL

For a long time, the following methods were used:

a) Ranking method

b) Paired comparison

c) Grading

d) Forced distribution method

e) Forced choice method

f) Checklist method

g) Critical incidents methods

h) Graphic scale method

i) Essay method

j) Field Review Method

In recent times the additional methods used are

i. Appraisal by results or objectives

ii. Behaviourally anchord rating scales (BARS)

iii. Assessment centres

iv. 360-degree appraisal

Ranking Method

Ranking is the oldest and simple method of appraisal in which a person is ranked against others
on the basis of certain traits or characteristics.

This is very simple method when the number of persons to be ranked is small because ranking
has to be given on the basis of traits which are not easily determinable, unlike marks in an
examination.

The method has limited value for performance appraisal as the difference in ranks do not indicate
absolute or equal differences of ability between individuals.
Paired comparison

Paired comparison method is a slight variation of ranking system. This method is adopted for use
in the large groups. In this method, each person is compared with other persons taking only one
at a time.

Usually only trait, overall suitability to perform the job, is considered. The rater puts a tick mark
against the person whom he considered the better of the two, and final ranking is determined by
the number of times that person is judged better than others.

Grading

This is a method where certain categories of abilities of performance are defined well in advance.

Persons are put in particular category depending on their traits and characteristics.

The categories may be outstanding, good, average, poor, very poor or may be in terms of letter
like A,B,C,D etc., with A indicating the best and D indicating the worst.

The actual performance of the employees is measured against these grades.

This method is generally useful for promotion based on performance.

Forced Distribution Method

As there is a tendency to rank high many of the employees, forced distribution method has been
adopted. In this method, the appraiser is forced to appraise the appraisers according to the pattern
of a normal curve.

The basic assumption in this method is that the employee’s performance.

Conforms to a normal statistical distribution.

The basic advantage of this method is that it overcomes the problem of adopting a central
tendency of rating most of the employees to a point, particularly high or near high to appeaser
them.

Forced – Choice Method

The forced – choice rating method contains a series of group statements and the rater checks how
effectively the statement describes each individual under evaluation.

Though both of them describe the characteristics of an employee, the rater is forced to tick only
one which appears to be more descriptive of the employee.
Out of these two statements, only one statement is considered for final analysis of rating.

For example, a rater may be given the following two statements. i. The employee is hard
working ii. The employee gives clear instructions to his subordinates.

Both these statements are positive but the rater is asked to rate only one which is more
descriptive of his subordinate’s behaviour.

This is done to avoid subjectivity in rating.

Out of the above two statements, only one statement is to be considered for final ranking.

The final rating is done on the basis of all sets of statements. This method is more objective but it
involves lot of problems is constructing such sets of statements.

Check – List Method

Under this method HR department prepares series of questions. Each question has alternative
answers ‘Yes’ or ‘No’.

The rater concerned has to tick appropriate answers relevant to the appraises.

Some of the same questions are:

Is he / she interested in the job Yes/No

Is he / she regular on the job Yes / No

Does he / she show uniform behaviour to all Yes /No

Is he / she willing to help other employers Yes / No

Does he / she maintain discipline Yes / No

Fifty to hundred questions including many bearing efficiency and concentration may be asked.

Different questions may have different weightage of scores. After filling the questionnaire by the
rater who observes the employees will be sent to HR department, which will compute total score
and evaluate.

Critical Incidence Method

In this method, only critical incidents and behaviour associated with these incidents are taken for
evaluation.
This method involves three steps.

A test of noteworthy on the job behaviour (good or bad) is prepared.

A group of experts then assigns scale values depending on the degree of desirability for the job.

Finally, a check list of incidents which define good and bad employees is prepared.

The rater is given this checklist for rating.

The basic idea behind this rating is to appraise the people who can do well in critical situations
because in normal situation most employees work alike.

This method is useful to find potential employees who can be useful in critical situation.

Graphic Scale Method

Graphic scale is also known as linear rating scale. This is most commonly used method of
performance appraisal.

In this method, a printed appraisal form is used for each appraises. The form contains various
employee characteristics and his job performance.

Various characteristics are, leadership, dependability, cooperativeness, enthusiasm, creativity,

analytical ability, decisiveness, emotional maturity etc., depending on the level of the employee.

Job performance includes quantity and quality of work performance, specific targets achieved,
regularity of attendance etc.

The degree of quality may be measured on three point or five point scale.

On five point scale, ‘excellent, very good, average, poor or very poor’ may be grading.

Essay Method

Instead of using structured forms for performance appraisal, some companies use free essay
method. In essay method rater assesses the employees on certain parameters in his own word.

Such parameters may be

1. Work performance in terms of quality, quantity and costs.

2. Knowledge about the job

3. Knowledge about organizational policies, procedures and rules,

4. Employee’s characteristics and behaviour

5. Employee’s strength and weakness

6. Overall suitability of the employee;

7. Employee’s potentiality

8. Training and development needs of the employeeThe essay method is useful in providing
fruitful information about an employee on the basis of which he can be appraised.

The difficulty in free essay method is each rater may use his own style and perception, which
may give rise to difficulty in analysis.

Field Review Method

In the field review method, an employee is not appraised by his direct superior but by another
person, usually from HR department.

The reason is that such a person may take more objective view in appraisal as he is not under
pressure as the superior of the employee may be.

The rater, in this case, appraises the employee based on his records of output and other
quantitative information such as absenteeism, late coming etc.

the rater also conducts interviews of the employees and his superior to ascertain qualitative
aspects of job performance.

This method is more suitable for promotion purpose.

Appraisal by Results or Objectives

Appraisal by results draws its root from management by objective (MBO). The various steps

involved in appraisal by results are as follows.

1. Appraisal by result is a joint process between superior and his subordinates.

2. The subordinate prepares his plan for specific period usually for one year in the light of the
overall plan provided by his superior.

The final plan is prepared through mutual consultation.

3. Through mutual consultation, both of them decide the evaluation criteria, that is what factor
will be taken for evaluation of subordinate’s performance.

4. At the end of specific period, normally one year, the superior makes a performance evaluation
of subordinate on the basis of mutually agreed criteria.

5. Superior discusses the results of his evaluation with the subordinate, corrective actions, if
necessary and mutually agreed targets for the next period would be fixed.

Evaluation of appraisal by results springs from forces that have generated a popular philosophy
of management, known as ‘management by objectives’ or ‘management by results’.

MBO is not merely a technique of managing but it reflects about the entire philosophy of
management.

Appraisal by results under MBO is more conducive than appraisal based on traits.

BARS Behaviorally anchored rating scales (BARS) approach gets away from measuring
subjective personal traits and instead measures observable, critical behaviors that are related to
specific job dimensions.

The various steps under BARS are.

i. Identification of Performance Measures

The first step is the identification of performance measures, that is, the outcome of an effective
job performance.

These measures could be identified by knowledgeable relevant people who may be usually
superiors, jobholders and HR personnel or a combination of all of them.

They are asked to identify the important dimensions of the job.

ii. Identification of Critical behaviours

Critical behaviours are those which are essential for the performance of the job effectively.

These behaviours are generated from different dimensional of the job and are related to various

critical incidents of the job.

These may be stated in a few short sentences or phrases using the terminology of the job in

question.

iii. Retranslation of Critical Behaviours

Various critical behaviours as identified in step ii. are retranslated, usually by a different group
of personnel.

In the retranslation process, various critical incidents are classified into clusters with each cluster
having similar critical incidents.

Those behaviours which are approved by majority of personnel are kept for further development

and others discarded.

The basic idea of this step is to keep the number of behaviours to a manageable limit and which
are more descriptive of the job.

The translation process assures the reliability of the critical behaviours consistent with the job

dimensions.

iv. Scaling of Critical Behaviours

Those critical behaviours which are included for the performance apprise during the process of
retranslation are given scales usually in numbers with their description.

The scales may range from 1 to 7 or from 1 to 9, with each point of a scale demonstrating

perceived level of performance.

The scale value will be determined on the basis of estimates provided by various persons in the
retranslation process.

v. Development of the BARS instrument

The result of arranging various scales for different dimensions of the job (Known as behaviour
anchors) produces a vertical scale for each dimension. Then scale is used for performance
appraisal.
MERITS OF BARS METHOD

1. Employees’ behaviours and not their unobservable traits, are measured which gives better

description of employees.

2. BARS approach is aimed at specific dimensions of job performance

3. The people who are actually involved with the job, participate in determining the job

dimensions.

4. As the evaluation is done in terms of specific behaviours, the rater can give objective feedback
on how the person performed and on what specific behaviour the concerned person should
improve.

Assessment Centers

The concept of assessment centers was started in Germany in 1930s by the War office selection
Board for military situation.

The object being to test candidates in a social situation, using number of assessors and a variety
of procedures.

Gradually this concept crept in to industries and companies. An assessment centre is a central
location where mangers come together and participate in a number of simulated exercises, on the
basis of raters.

The task Force on Development of Assessment centre standards, has recommended the following
requirements.

a) Multiple assessment techniques should be used. One of these techniques should be simulation.

b) Multiple trained assessors should be used.

c) Judgement should be based on pooled information from all assessors.

d) Evaluation should be made at a time different from the observation of behaviour.

e) Simulation exercise should be tested for their reliability, validity and objectivity.

f) The dimensions, attributes, characteristics or qualities evaluated by the programme shall be

determined by an analysis of relevant job behaviour.

The objectives of Assessment Centers are:

a) For measuring potential for first level supervision, upper management positions and also

higher level management positions.

b) For determining the training and development needs of employees

c) For selecting recent college students for entry level positions

d) For making early determination of potential and

360 Degree appraisal

In 360 –degree appraisal, appraisal of an employee is done by his superior, his peers, his

subordinates clients and outsiders with whom he interacts in the course of his job performance.

In this appraisal, besides appraising the performance of the assesses, his other attributes such as

talents, behaviour, values, and technical considerations are also subjected to appraisal.

The role of HR department in 360 – degree appraisal is that of facilitator. The department

consolidates the appraisal inputs, identifies the point of consensus, and provides feedback to the

appraised so as to overcome weaknesses as pointed out in the appraisal.

 METHODS OF PERFORMANCE APPRAISAL

1. Rating Scales: Rating scales consists of several numerical scales representing job related

performance criterions such as dependability, initiative, output, attendance, attitude etc.

Each scales ranges from excellent to poor. The total numerical scores are computed and final

conclusions are derived.

Advantages – Adaptability, easy to use, low cost, every type of job can be evaluated, large

number of employees covered, no formal training required.

Disadvantages – Rater’s biases

2. Checklist: Under this method, checklist of statements of traits of employee in the form of Yes

or No based questions is prepared.

Here the rater only does the reporting or checking and HR department does the actual evaluation.

Advantages – economy, ease of administration, limited training required, standardization.

Disadvantages – Raters biases, use of improper weighs by HR, does not allow rater to give

relative ratings

3. Forced Choice Method: The series of statements arranged in the blocks of two or more are

given and the rater indicates which statement is true or false.

The rater is forced to make a choice. HR department does actual assessment.

Advantages – Absence of personal biases because of forced choice.

Disadvantages – Statements may be wrongly framed.

4. Forced Distribution Method: here employees are clustered around a high point on a rating

scale. Rater is compelled to distribute the employees on all points on the scale.

It is assumed that the performance is conformed to normal distribution.

Advantages – Eliminates

Disadvantages – Assumption of normal distribution, unrealistic, errors of central tendency.

5. Critical Incidents Method: The approach is focused on certain critical behaviors of employee
that makes all the difference in the performance. Supervisors as and when they occur record such
incidents.

Advantages – Evaluations are based on actual job behaviors, ratings are supported by

descriptions, feedback is easy, reduces recency biases, chances of subordinate improvement are

high.

Disadvantages – Negative incidents can be prioritized, forgetting incidents, overly close

supervision; feedback may be too much and may appear to be punishment.

6. Behaviorally Anchored Rating Scales: statements of effective and ineffective behaviors

determine the points. They are said to be behaviorally anchored.

The rater is supposed to say, which behavior describes the employee performance.

Advantages – helps overcome rating errors.

Disadvantages – Suffers from distortions inherent in most rating techniques.

7. Field Review Method: This is an appraisal done by someone outside employees’ own

department usually from corporate or HR department.

Advantages – Useful for managerial level promotions, when comparable information is needed,

Disadvantages – Outsider is generally not familiar with employees work environment,

Observation of actual behaviors not possible.

8. Performance Tests & Observations: This is based on the test of knowledge or skills.

The tests may be written or an actual presentation of skills. Tests must be reliable and validated

to be useful.

Advantage – Tests may be apt to measure potential more than actual performance.

Disadvantages – Tests may suffer if costs of test development or administration are high.

9. Confidential Records: Mostly used by government departments, however its application in

industry is not ruled out.

Here the report is given in the form of Annual Confidentiality Report (ACR) and may record

ratings with respect to following items; attendance, self expression, team work, leadership,

initiative, technical ability, reasoning ability, originality and resourcefulness etc.

The system is highly secretive and confidential. Feedback to the assessee is given only in case of

an adverse entry.

Disadvantage is that it is highly subjective and ratings can be manipulated because the
evaluations are linked to HR actions like promotions etc.

10. Essay Method: In this method the rater writes down the employee description in detail

within a number of broad categories like, overall impression of performance, promoteability of

employee, existing capabilities and qualifications of performing jobs, strengths and weaknesses

and training needs of the employee.

Advantage – It is extremely useful in filing information gaps about the employees that often

occur in a better-structured checklist.

Disadvantages – It its highly dependent upon the writing skills of rater and most of them are not

good writers. They may get confused success depends on the memory power of raters.

11. Cost Accounting Method: Here performance is evaluated from the monetary returns yields

to his or her organization. Cost to keep employee, and benefit the organization derives is

ascertained. Hence it is more dependent upon cost and benefit analysis.

12. Comparative Evaluation Method (Ranking & Paired Comparisons): These are collection

of different methods that compare performance with that of other co-workers.

The usual techniques used may be ranking methods and paired comparison method.

Ranking Methods: Superior ranks his worker based on merit, from best to worst. However

how best and why best are not elaborated in this method. It is easy to administer and explanation.

Paired Comparison Methods: In this method each employee is rated with another employee

in the form of pairs. The number of comparisons may be calculated with the help of a formula as

under. N x (N-1) / 2
Modern Methods

1. Management By Objectives: It means management by objectives and the performance is

rated against the achievement of objectives stated by the management. MBO process goes as

under.

 Establish goals and desired outcomes for each subordinate

 Setting performance standards

 Comparison of actual goals with goals attained by the employee

 Establish new goals and new strategies for goals not achieved in previous year.

Advantage – It is more useful for managerial positions.

Disadvantages – Not applicable to all jobs, allocation of merit pay may result in setting short-

term goals rather than important and long-term goals etc.

2. Psychological Appraisals: These appraisals are more directed to assess employees potential

for future performance rather than the past one.

It is done in the form of in-depth interviews, psychological tests, and discussion with
supervisors and review of other evaluations.

It is more focused on employees emotional, intellectual, and motivational and other personal
characteristics affecting his performance.

This approach is slow and costly and may be useful for bright young members who may have
considerable potential.

However quality of these appraisals largely depend upon the skills of psychologists who perform
the evaluation.

3. Assessment Centers: This technique was first developed in USA and UK in 1943.

An assessment center is a central location where managers may come together to have their
participation in job related exercises evaluated by trained observers.

It is more focused on observation of behaviors across a series of select exercises or work samples.
Assessees are requested to participate in in-basket exercises, work groups, computer simulations,
role playing and other similar activities which require same attributes for successful performance
in actual job.

The characteristics assessed in assessment center can be assertiveness, persuasive ability,

communicating ability, planning and organizational ability, self confidence, resistance to stress,
energy level, decision making, sensitivity to feelings, administrative ability, creativity and
mental alertness etc.

Disadvantages – Costs of employees traveling and lodging, psychologists, ratings strongly

influenced by assessee’s inter-personal skills.

Solid performers may feel suffocated in simulated situations. Those who are not selected for this
also may get affected.

Advantages – well-conducted assessment center can achieve better forecasts of future

performance and progress than other methods of appraisals.

Also reliability, content validity and predictive ability are said to be high in assessment centers.

The tests also make sure that the wrong people are not hired or promoted. Finally it clearly

defines the criteria for selection and promotion.

4. 360-Degree Feedback: It is a technique which is systematic collection of performance data on

an individual group, derived from a number of stakeholders like immediate supervisors, team

members, customers, peers and self.

In fact anyone who has useful information on how an employee does a job may be one of the

appraisers. This technique is highly useful in terms of broader perspective, greater self

development and multi-source feedback is useful.

360-degree appraisals are useful to measure inter-personal skills, customer satisfaction and team

building skills. However on the negative side, receiving feedback from multiple sources can be

intimidating, threatening etc.

Multiple raters may be less adept at providing balanced and objective feedback
 METHODS FOR APPRAISING PERFORMANCE

(A) Traditional Methods- Following are the traditional methods used in Business organizations:

1. Straight Ranking Method:The ranking system requires the rater to rank his subordinates on
overall performance. This consists in simply putting a man in a rank.

Under this method, the ranking of an employee in a work group is done against that of another
employee.

The relative position of each employee is tested in terms of his numerical rank.

It may also be done by ranking a person on his job performance against another member of the
competitive group.

2. Forced Distribution method- This is a ranking technique where raters are required to allocate
a certain percentage of rates to certain categories (e.g. superior, above average, average) or
percentiles (e.g. top 10 percent, bottom 20 percent etc).

Both the number of categories and percentage of employees to be allotted to each category are a
function of performance appraisal design and format.

The workers of outstanding merit may be placed at top 10 percent of the scale; the rest may be
placed as 20 % good, 40 % outstanding, 20 % fair and 10 % poor.

3. Grading Method- Under this method, the actual performance of an employee is compared

with these grade definitions such as A- outstanding, B- Very good, C- good or average, D- fair,

E- poor and –B(or B-) very poor or hopeless.

Then rater allot the grade which best describes his performance.

4. Graphic or Linear Rating Scale- This is the most common method of performance appraisal.

Under it, a printed form, one for each person to be rated according to employee characteristics

and employee contribution is given.

These traits are then evaluated on a continuous scale, wherein the rater places a mark. Sometimes

a discontinuous or multiple type of scale is used, where in one factor is used along a
discontinuous scale, consisting of appropriate boxes or squares which are to be ticked off.

5. Checklists and Weighted Checklists-In this system, a large number of statements that describe

a specific job are given. Each statement has a weight or scale value attached to it.

While rating an employee the supervisor checks all those statements that most closely describe

the behaviour of the individual under assessment.

The rating sheet is then scored by averaging the weights of all the statements checked by the

rater. A checklist is constructed for each job after consulting the persons who are quite familiar

with the jobs.

These statements are then categorized by the judges and weights are assigned to the statements in

accordance with the value attached by the judges.

6. Free Essay Method- This is a very easy method of performance appraisal. In this method, the

supervisor takes a free form for an, open-ended appraisal of an employee in his words and puts

down his impressions about the employee.

He takes some note of the factors such as what is the relationship of employees with his fellow

supervisors and other staff, job knowledge and potential, employee characteristics and attitudes,

understanding and application of company policies and procedures, production, quality and cost

control, physical conditions etc.

7. Critical Incident Method- In this method the supervisor keeps a written record of the events

(either good or bad) that can easily be recalled and used in the course of a periodical or formal

appraisal. Feedback is provided about the incidents during performance review session.

Various behaviors are recorded under categories such as the type of job, requirement for
employees, judgment, learning ability, productivity and precision of work, responsibility and
initiative.
8. Group appraisal Method- In this method of group appraisal the group consists of their
supervisor and three or four other supervisors, who have some knowledge of their performance.

The supervisor explains to the group the nature of his subordinate’s duties. Then the group
discusses the standards of performance for that job, the actual performance of the job-holder, and
the causes of their particular level of performance and offers suggestions for future improvement,
if any.

9. Field Review Method- This system is basically used in large organizations. Under this
method, a trainer employee from the personnel department, interviews line supervisors to
evaluate their respective subordinates.

The appraiser asks the questions to test. The supervisor gives his opinion about the performance
of the subordinates whether it is good or bad.

The type of the questions is oral. The success of this system depends upon the competence of

the interviewer.

10. Confidential report system: It is mostly used in organizations. Generally it is made at the end
of every year.

It is a descriptive report. The employee's immediate superior prepared this report.

The report highlights the strengths and weaknesses of the subordinate. The report is not data
based. The opinion or the perception of the superior about the subordinate are merely recorded

there.

Main feature of this system is that it does not offer any feedback to the appraise.

This is the most traditional method and is still in use in number of Indian Organizations.

Generally it is assumed that since the immediate superior is one who has maximum contact with
the person assessed, he would be the best person to evaluate him

(B) MODERN METHODS OF APPRAISAL

Following modern methods of performance evaluation are used by the organizations with

specific management thought.

1) Management by Objectives or Appraisal by Results – This method is formulated by Peter

Drucker. In this method, there is maximizing internal motivation, through joint goal setting,

between the manger and the subordinate and increasing the subordinate’s own control.

2) Assessment Centre Method- Under this method, many evaluators join together to judge
employee performance in several situations with the use of a variety of criteria.

It is used mostly, to help select employees for the first level (the lowest) supervisory positions.

This method is used for promotion of potential employees.

The assessment is generally done, with the help of a couple of employees, and it Involves a

paper-and-pencil test, interviews and situational exercises.

3) 360 Degree Performance Appraisal- Under this method, the employees’ performance should

assess without bias. The appraiser should be honest and intelligent.

The appraisers are supervisors, peers, subordinates employees themselves users of service and
consultants.

All these parties conduct performance appraisal so it is called “360 appraisal.

4) Human Asset Accounting Method- This method refers to activity, devoted to attaching
money estimates to the value of a firm’s internal human organization and its external customer
goodwill.

If able, well-trained personnel leave a firm, the human organization is worthless .If they join it,
its human assets are increased.

5) Behaviorally Anchored Rating Scales (BARS) - This is a new appraisal technique which has
recently been developed.

The BARS is usually five stepped:

1. Generate Critical Incidents 2. Develop Performance Dimensions 3. Reallocate Incidents 4.

Scale of Incidents and 5. Develop Final Instrument.

This technique is more time-consuming and expensive than other appraisal tools, but it is a more
accurate gauge, because it is done by persons, expert in the technique. The results are sufficiently
accurate.

6) Forced Choice Method- In its simplest form the method consists of providing a list of

behavior related statements. The supervisor is asked to indicate one least and one most

descriptive statement for a particular subordinate.

These statements are usually grouped in clusters of five based on a broad theme covered by these

statements. Each statement carries some weight which is not known to the supervisor.

7) Balanced Scorecard- The concept was introduced by Kaplan and Norton (1992) as a tool for

performance management. It seeks to widen the definition of performance by considering

multiple stakeholders and their impact on the organizational performance.

It is a mechanism to measure change in the business process, growth of employees and customer

base, when the organization is striving to achieve its goals.

The usual measures of the balanced scorecard are financial perspective measures (net income,

operating margin, earning per share and revenue), operational perspective measures(safety,

productivity, new product Introduction), Customer perspective measures (customer satisfaction,

customer loyalty) and learning perspective measures (personal development, employee

satisfaction).

360 DEGREE PERFORMANCE APPRAISALS:

360 degree feedback, also known as ‘multi-rater feedback’, is the most comprehensive appraisal
method where the feedback about the employee’s performance comes from all the sources ,that
means, his/her peers, managers (i.e. superior), subordinates, team members, customers, suppliers/
vendors - anyone who come in contact with him on his job and can provide valuable insights and
information or feedback regarding the “on-the-job” performance of the employee.

But these respondents should assess the performance of the employee without bias.
360 degree appraisal has four integral components:

1. Self appraisal

2. Superior’s appraisal

3. Subordinate’s appraisal

4. Peer appraisal

Self assessment is an indispensable part of 360 degree appraisals.

This method has a high degree of employee involvement and also has the strongest impact on
their behavior and performance.

This appraisal method is effective in identifying and measuring certain skills of an employee like
interpersonal skills, customer satisfaction and team building skills etc.

This credible method provides a “360- degree review” of the employee’s performance.

Moreover, an employee gets a chance to look at his/her strengths and weaknesses, his
achievements, and can judge his own performance through self appraisal.

There is a traditional part in 360 degree appraisal method in the form of superior’s appraisal
where the employee’s responsibilities and actual performance is rated by the superior.

Certain parameters of the employee like communication and motivating abilities, ability to
delegate the work, leadership qualities etc. can be judged from the subordinates’ appraisal.

If the correct feedbacks are provided by peers [also known as internal customers], then it can
help in measuring the employee’s abilities to work in a team, co-operation and sensitivity
towards others.

360 degree appraisal is also a powerful developmental tool. When conducted at regular intervals
(say yearly), it helps to keep a record of the changing perceptions of other’s about the
employee’s performance.

The method is more suitable for the managers as it helps them to assess their leadership quality
and managing style by knowing other’s perceptions about them.

This technique is being effectively used in some of the organizations like Wipro, Infosys, and
Reliance Industries etc for performance appraisals.
This method also has some limitation. Receiving feed back on performance from multiple
sources may be an intimidating situation.

Further, the organization has to devote a long time in selecting the rater, designing questionnaires
and analyzing the data which is not justifiable in this busy working environment.

In addition, multiple raters are less likely to provide a balanced and objective feedback than the
supervisors who are sought to be replaced.

Personal differences and biases may also be the limiting factors in this method.

QUE NO 11: A KEY PERFORMANCE INDICATOR (KPI) is a measure reflecting how an

organisation is doing in specific aspect of performance.

A KPI is one representation of a critical success factor (CSF) - A key activity needed to achieve

strategic objective.

Organisations that measure performance identify the handful of critical success factors that

comprise every strategic objective.

For example, depending on a company’s strategy, the organisation might have a KPI for the

percentage of income the organisation derives from international markets.

Key financial performance indicators are:

 Return on Investment (ROI) / Return on Total Assets (ROTA): ROI represents the benefits
generated from the use of assets in a company, unit, or group – or on a project.

ROI= Net Income/ Total Assets92

 Economic Value Added (EVA): EVA is defined as the value of business activity that is left

over after subtracting from it the cost of executing that activity and the cost of the physical and

financial capital deployed to generate the profits.

EVA= Net operating profit after taxes – (net operating assets x weighted average cost of capital).
Apart from these key financial indicators, company’s financial performance can be computed on

the basis of following profitability ratios:

1. Margin on Sales percentage= Earning before Interest and Tax % / Sales

2. Sales to total assets= Sales / Total Assets

Customer profitability (i.e. Customer count, customer retention) is the important performance

metric also reveals the organisational performance.

QUE NO 12: BALANCED SCORECARD

The balanced scorecard is a strategic planning and management system that is used extensively
in business and industry, government, and non-profit organizations worldwide to align business
activities to the vision and strategy of the organization, improve internal and external
communications, and monitor organization performance against strategic goals.

It was originated by Dr Robert Kaplan (Harvard Business School) and Dr David Norton as a
performance measurement framework that added strategic non-financial performance measures
to traditional financial metrics to give managers and executives a more 'balanced' view of
organizational performance.

 Balanced Scorecard Perspectives: The balanced scorecard suggests that we view the

organization from four perspectives, and to develop metrics, collect data and analyze it relative

to each of these perspectives:

1. Financial Perspective: examines if the company’s implementation and execution of its

strategy are contributing to the bottom-line improvement of the company.

Some of the most common financial measures that are incorporated in the financial perspective

are revenue, profit margins, net operating income, return on capital employed, and economic

value added etc.

2. Customer Perspective: defines the value proposition that the organisation will apply in order

to satisfy customers and thus generate more sales to the most desired (i.e the most profitable)
customer groups.

The measures that it includes such as customer retention, customer satisfaction and market share

in target segments.

3. Business Process Perspective: is concerned with the processes that create and deliver the

customer value proposition.

It focuses on all the activities and key processes required in order for the company to excel at

providing the value expected by the customer both productively and efficiently.

It includes measure such as cost, throughput, and quality. These are for business processes such

as procurement, production and order fulfillment.

4. Learning and Growth Perspective: is the foundation of any strategy and focuses on the

intangible assets of an organisation, mainly on the internal skills and capabilities that are

required to support the value creating internal processes.

It includes measures such as employee satisfaction, employee retention, employee skills etc.

 BENEFITS OF BALANCED SCORECARD

The benefits of the balanced scorecard approach in measuring performance are:

1. It gives the complete picture of the employee as well as the organisational performance.

 It guides users in determining the critical success factors and performance indicators.

 Strategic review or analysis of the organisational capabilities and performance.

 Focusing the whole organisation on the few key things needed to create breakthrough

performance.

 Integrating and directing the performance and efforts from the lowest levels in the

organisation to achieve excellent overall performance.

BALANCED SCORECARD: The balanced scorecard is a management system (not only a

measurement system) that enables organizations to clarify their vision and strategy and translate

them into action.

It provides feedback around both the internal business processes and external outcomes in order
to continuously improve strategic performance and results.

The balanced scorecard suggests that we view the organization from four perspectives, and to
develop metrics, collect data and analyze it relative to each of these perspectives:

a) The Learning and Growth Perspective

b) The Business Process Perspective

c) The Customer Perspective

d) The Financial Perspective

a) The Learning and Growth Perspective

This perspective includes employee training and corporate cultural attitudes related to both
individual and corporate self-improvement.

In a knowledge-worker organization, people -- the only repository of knowledge -- are the main
resource.

In the current climate of rapid technological change, it is becoming necessary for knowledge
workers to be in a continuous learning mode.

Government agencies often find themselves unable to hire new technical workers and at the same
time is showing a decline in training of existing employees.

This is a leading indicator of 'brain drain' that must be reversed.

Metrics can be put into place to guide managers in focusing training funds where they can help
the most.

Kaplan and Norton emphasize that 'learning' is more than 'training'; it also includes things like
mentors and tutors within the organization, as well as that ease of communication among
workers that allows them to readily get help on a problem when it is needed.

It also includes technological tools; what the Baldrige criteria call "high performance work
systems." One of these, the Intranet, will be examined in detail later in this document.

b) The Business Process Perspective

This perspective refers to internal business processes. Metrics based on this perspective allow

the managers to know how well their business is running, and whether its products and

services conform to customer requirements (the mission).

These metrics have to be carefully designed by those who know these processes most intimately;
with our unique missions these are not something that can be developed by outside consultants.

In addition to the strategic management process, two kinds of business processes may be
identified:

a) mission-oriented processes, and b) support processes. Mission-oriented processes are the

special functions of government offices, and many unique problems are encountered in these
processes.

The support processes are more repetitive in nature, and hence easier to measure and benchmark
using generic metrics.

c) The Customer Perspective

Recent management philosophy has shown an increasing realization of the importance of

customer focus and customer satisfaction in any business.
These are leading indicators: if customers are not satisfied, they will eventually find other
suppliers that will meet their needs.

Poor performance from this perspective is thus a leading indicator of future decline, even though
the current financial picture may look good.

In developing metrics for satisfaction, customers should be analyzed in terms of kinds of

customers and the kinds of processes for which we are providing a product or service to those
customer groups.

d) The Financial Perspective

Kaplan and Norton do not disregard the traditional need for financial data. Timely and accurate

funding data will always be a priority, and managers will do whatever necessary to provide it.

In fact, often there is more than enough handling and processing of financial data.

With the implementation of a corporate database, it is hoped that more of the processing can be
centralized and automated.

But the point is that the current emphasis on financials leads to the "unbalanced" situation with
regard to other perspectives. There is perhaps a need to include additional financial related data,
such as risk assessment and cost-benefit data, in this category.

 BALANCED SCORECARD QUADRANTS

The Balanced Scorecard consists of four interrelated quadrants, each containing measures for a

distinct perspective. These perspectives are:

• financial

• customer

• internal processes

• learning and growth.

These four perspectives are designed to cover the whole of the organisation’s activities, both

internally and externally, current and future.

Financial perspective

The financial perspective is a key factor of any performance measurement system because an
organisation’s financial performance is fundamental to its success.

Measures reflecting financial performance include the number of debtors, creditors, cash flow,
profitability and return on investment.

The main problems with financial measures are as follows.

• They are based on past data. Financial measures show what has happened but they may not tell
us what is currently happening.

They are not necessarily a good indicator of future performance.

• They are short termist and do not focus on the organisation’s long term financial strategy.

Customer perspective

These are measures that have a direct impact on customers. They could include time taken to
process a phone call, the number of customer complaints, results of customer surveys or volume
of repeat customers.

The customer and customer satisfaction have had a growing importance in business.

Businesses recognise that if customers are not satisfied, they will find other suppliers to meet
their needs.

Business process perspective

These are measures of key business processes, such as time taken in production, re-work costs or
time to process an order.

These internal business focused measures allow the organisation to measure how well the
business is operating and whether its products and services meet customer requirements.

Learning and growth perspective

These are measures that highlight an organisation’s development and learning ability.

They might include the number of training days, the number of qualified staff or total hours
spent on staff training.
This perspective includes staff training and attitudes to organisational culture related to both
individual and corporate self-improvement.

This quadrant recognises that in a knowledge worker organisation, people are the greatest

resource.

Kaplan and Norton focus upon the fact that 'learning' is more than 'training'.

 INTRODUCTION

The balance scorecard is used as a strategic planning and a management technique.

This is widely used in many organizations, regardless of their scale, to align the organization's
performance to its vision and objectives.

The scorecard is also used as a tool, which improves the communication and feedback process
between the employees and management and to monitor performance of the organizational
objectives.

As the name depicts, the balanced scorecard concept was developed not only to evaluate the
financial performance of a business organization, but also to address customer concerns, business
process optimization, and enhancement of learning tools and mechanisms.

 THE BASICS OF BALANCED SCORECARD

Following is the simplest illustration of the concept of balanced scorecard.

The four boxes represent the main areas of consideration under balanced scorecard.

All four main areas of consideration are bound by the business organization's vision and strategy.
The balanced scorecard is divided into four main areas and a successful organization is one that
finds the right balance between these areas.

Each area (perspective) represents a different aspect of the business organization in order to
operate at optimal capacity.

 Financial Perspective - This consists of costs or measurement involved, in terms of rate

of return on capital (ROI) employed and operating income of the organization.
 Customer Perspective - Measures the level of customer satisfaction, customer retention
and market share held by the organization.
 Business Process Perspective - This consists of measures such as cost and quality
related to the business processes.
 Learning and Growth Perspective - Consists of measures such as employee satisfaction,
employee retention and knowledge management.

The four perspectives are interrelated. Therefore, they do not function independently. In real-
world situations, organizations need one or more perspectives combined together to achieve its
business objectives.

For example, Customer Perspective is needed to determine the Financial Perspective, which in
turn can be used to improve the Learning and Growth Perspective.

 The Need for a Balanced Scorecard

Following are some of the points that describe the need for implementing a balanced scorecard:

 Increases the focus on the business strategy and its outcomes.

 Leads to improvised organizational performance through measurements.
 Align the workforce to meet the organization's strategy on a day-to-day basis.
 Targeting the key determinants or drivers of future performance.
 Improves the level of communication in relation to the organization's strategy and vision.
 Helps to prioritize projects according to the timeframe and other priority factors.

Conclusion

As the name denotes, balanced scorecard creates a right balance between the components of
organization's objectives and vision.

It's a mechanism that helps the management to track down the performance of the organization
and can be used as a management strategy.
It provides an extensive overview of a company's objectives rather than limiting itself only to
financial values.

This creates a strong brand name amongst its existing and potential customers and a reputation
amongst the organization's workforce.

 USES OF THE BALANCED SCORECARD

Kaplan and Norton found that companies are using the BSC to:

• clarify and update strategy

• communicate strategy throughout the company

• align unit and individual goals with strategy

• link strategic objectives to long term targets and annual budgets

• identify and align strategic initiatives

• conduct periodic performance reviews to learn about and improve strategy.

 BENEFITS OF BSC

The main benefits of the BSC are outlined below.

• It avoids management reliance on short-term or incomplete financial measures.

It ensures that senior management takes a balanced view about the organisation’s performance.

• Using the BSC can assist in ‘driving down’ the corporate strategy to divisions and functions by
forcing management to develop success measures related to corporate goals.

Top level strategy and middle management level actions are clearly connected and appropriately
focused.

• It can help stakeholders to evaluate the organisation if measures are communicated externally.

• The organisation’s performance reporting system (and the organisation itself) is much more
likely to focus on staying competitive in the long term and to realise value for its stakeholders.
 Drawbacks

The main drawbacks are outlined below.

• The BSC does not lead to a single aggregate summary control. The popularity of measures such
as Return on Investment (ROI) has been because they conveniently summarise ‘how things are
going’.

• Measures may give conflicting signals and confuse management. For example, if customer
satisfaction and financial indicators are both falling, do management sacrifice one or the other?

• It involves substantial shifts in corporate culture to implement, such as the need to re-focus on
the long term. The organisation must also be recognised as a set of processes rather than separate
departments.

• The approach is not a quick fix. It takes considerable thought to develop an appropriate
scorecard.

QUE NO 13: CHALLENGES OF PERFORMANCE APPRAISAL SYSTEM:

In order to make a performance appraisal system effective and successful, an organization comes
across various challenges and problems.

The main challenges involved in the performance appraisal process are:

1. Determining the evaluation criteria:

Identification of the appraisal criteria is one of the biggest problems faced by the top

management. The performance data to be considered for evaluation should be carefully selected.

For the purpose of evaluation, the criteria selected should be in quantifiable or measurable terms

2. Creating rating instruments:

The purpose of the performance appraisal process is to judge the performance of the employees

rather than the employee. The focus of the system should be on the development of the

employees of the organization

3. Lack of Competence:

Top management should choose the raters or the evaluators carefully.

They should have the required expertise and the knowledge to decide the criteria accurately.

They should have the experience and the necessary training to carry out the appraisal process

objectively.

4. Errors in rating and evaluation:

Many errors based on the personal bias like stereotyping, halo effect (i.e. one trait influencing the

evaluator’s rating for all other traits) etc. may creep in the appraisal process.

Therefore the rater should exercise objectivity and fairness in evaluating and rating the

performance of the employees

5. Resistance:

The appraisal process may face resistance from the employees and the trade unions for the fear
of negative ratings.

Therefore, the employees should be communicated and clearly explained the purpose as well the
process of appraisal.

The standards should be clearly communicated and every employee should be made aware that
what exactly is expected from him/her.

Other challenges of Performance Appraisal:

1. Create a culture of excellence that inspires every employee to improve and lend him or herself

to be assessed.

2. Aligns organisational objectives to individual aspirations.

3. Clear growth paths for talented individuals.

4. Provide new challenges to rejuvenate careers that have reached the plateau stage.

5. Forge a partnership with people for managing their careers.

6. Empower employees to make decisions without the fear of failing

7. Embed teamwork in all operational processes.

8. Debureaucratise the organisation structure for ease of flow of information.

 PROBLEMS OF PERFORMANCE APPRAISAL: Research studies also report, by and

large, similar problems of performance appraisal. For example, Dayal in his on-the-spot
investigation of two Indian manufacturing companies finds the following :

1. No significant relationship was found between employees performance evaluation and their
promotions, transfers, placements, etc.

2. Low reliability was noticed what the rater reported on paper about the performance of a
subordinate and what he/she reported in face-to-face discussion.

3. Supervisors took only a few minutes to complete the appraisal before its submission.

4. Supervisiors revealed some sort of anxiety in apraising their subordinates.

5. The evaluation of an employee made by the two raters revealed remarkable variation.

Closely related to Dayal’s findings were the problems reported by some other studies also.

1. Wider variation between raters than between ratees.

2. Feedback on employee appraisal is found pleasant neither for rater nor ratee.

3. Most supervisor-raters do not possess the required tact and insight to convey employees
constructively how to improve their performance.

 PROBLEMS WITH PERFORMANCE APPRAISAL

The problems inherent in performance appraisal may be listed thus (Teel; Gioia and Sims)

1. Judgement Errors: People commit mistakes while evaluating people and their performance.
Biases and judgement errors of various kinds may spoil the show. Bias here refers to

distortion of a measurement. These are of various types:

(i) First impressions (primacy effect): The appraiser's first impression of a candidate may colour

his evaluation of all subsequent behaviour.

In the case of negative primacy effect, the employee may seem to do nothing right; in the case of
a positive primacy effect, the employee can do no wrong (Harris, p.192).

(ii) Halo: The Halo error occurs when one aspect of the subordinate's performance affects the
rater's evaluation of other performance dimensions.

If a worker has few absences, his supervisor might give the worker a high rating in all other areas
of work.

Similarly, an employee might be rated high on performance simply because he has a good dress
sense and comes to office punctually!

(iii) Horn effect: The rater's bias is in the other direction, where one negative quality of

the employee is being rated harshly. For example, the ratee rarely smiles, so he cannot get along

with people!

(iv) Leniency: Depending on rater's own mental make-up at the time of appraisal, raters may be
rated very strictly or very leniently.

Appraisers generally find evaluating others difficult, especially where negative ratings have to be
given. A professor might hesitate to fail a candidate when all other students have cleared the
examination.

The leniency error can render an appraisal system ineffective. If everyone is to be rated high, the
system has not done anything to differentiate among employees.

(v) Central tendency: An alternative to the leniency effect is the central tendency, which

occurs when appraisers rate all employees as average performers.

For example, a professor, with a view to play it safe, might give a class grades nearly equal to B,

regardless of the differences in individual performance.

(vi) Stereotyping: Stereotyping is a mental picture that an individual holds about a person
because of that person's sex, age, religion, caste, etc.

By generalising behaviour on the basis of such blurred images, the rater grossly overestimates or
underestimates a person's performance.

For example, employees from rural areas might be rated poorly by raters having a sophisticated
urban background, if they view rural background negatively.

(vii) Recency effect: In this case, the rater gives greater weightage to recent occurrences than
earlier performance.

For example, an excellent performance that may be six or seven months old is conveniently
forgotten while giving a poor rating to an employee's performance which is not so good in recent
weeks.

Alternatively, the appraisal process may suffer due to a 'spill over effect' which takes place when
past performance influences present ratings.

2. Poor Appraisal Forms: The appraisal process might also be influenced by the following

factors relating to the forms that are used by raters:

(i) The rating scale may be quite vague and unclear.

(ii) The rating form may ignore important aspects of job performance.

(iii) The rating form may contain additional, irrelevant performance dimensions.

(iv) The forms may be too long and complex.

3. Lack of Rater Preparedness: The raters may not be adequately trained to carry out

performance management activities.

This becomes a serious limitation when the technical competence of a ratee is going to be
evaluated by a rater who has limited functional specialisation in that area.

The raters may not have sufficient time to carry out appraisals systematically and conduct
thorough feedback sessions.

Sometimes the raters may not be competent to do the evaluations owing to a poor self-image and
lack of self-confidence.
They may also get confused when the objectives of appraisal are somewhat vague and unclear.

Ineffective Organisational Policies and Practices: If the sincere appraisal effort put in by

a rater is not suitably rewarded, the motivation to do the job thoroughly finishes off.

Sometimes, low ratings given by raters are viewed negatively by management – as a sign of
failure on the part of rater or as an indication of employee discontent.

So, most employees receive satisfactory ratings, despite poor performance.

Normally, the rater's immediate supervisor must approve the ratings.

However, in actual practice, this does not happen.

As a result, the rater 'goes off the hook' and causes considerable damage to the rating process.

8.5.2 CHALLENGES

In present day organisations, the twin principles of motivating employees are common at all

levels: acknowledge unique contributions and alleviate personal concerns that impact

professional performance. To get the best out of people, the CEOs should:

 Create a culture of excellence that motivates employees at all levels.

 Match organisational objectives with individual aspirations.

 Equip people with requisite skills to discharge their duties well.

 Clear growth paths for talented employees.

 Provide new challenges to rejuvenate flattening corners.

 Empower employees to take decisions without fear of failing.

 PROBLEMS OF PERFORMANCE APPRAISAL

Since performance appraisal is conducted by human beings, it is subjected to a number of errors,

biases, weaknesses and pitfalls.

Some of these are discussed below.

1. The halo effect:

The halo effect is introduced when an overall impression of an individual is judged on the basis

of a single trait.

A high rating on one trait leads automatically to high rating on all other trait.

Also, a very high rating may be given to protect an employee for whom there may be personal

sympathy.

2. Constant error:

This error is a reflection on the trait of the rater. Some raters are, by nature, too liberal, others

too strict and some tend towards rating most people in the middle.

3. Recency of events:

There is a tendency of many evaluators to give much more weight to the recent behaviour of the

candidate than the past behaviour. This is based on the reflection that the future trend is

established by the mere recent behaviour.

4. The central tendency:

It is the most commonly found error. It is the tendency of most raters to give average ratings to

all or the center of the scale.

This may be due to the fact that a very high rating or a very low rating could invite questions,

criticisms or explanations.

Accordingly, an average rating is safer. It could also be due to the fact that the rather lacks

sufficient knowledge about the applicant and hence, does not want to commit himself one way to

another.

5. Errors of variable standards:

It is quite possible that organisations follow different standards of performance.

Some divisional heads may require much higher quality of performance than others.

6. Other miscellaneous biases:

There may be some built - in biases in the minds of the rater, based upon his own perception of

things, people and performances. A person may be rated higher because he is a 'nice' person or

because of his seniority.

QUE NO 14: WHAT IS CAREER PLANNING?

Career planning is an ongoing process where an employee explores his or her interests and
capabilities and purposefully plan career goals.

This is important for all employees since it can help to manage the direction the employee want
to progress in the career.

Career planning should be considered by an individual even before entering the workforce,
preferably when he or she is a student.

Educational qualifications play a vital role in obtaining employment; thus, it is important to

pursue a specific educational qualification, studying an area where the individual wishes to be
employed at. E.g. A young individual is interested in becoming a marketing professional in the
future.

Thus it is important to follow a recognized marketing qualification in order to gain a competitive

advantage in applying for a job.

Once an individual enters the workforce and starts working, career planning can be conducted in
an extended manner than at student stage.

The employee should clearly identify personal and career objectives, interests, strengths, and
weaknesses.

It is important to match the skills and capabilities with the job to understand how to improve
performance on the job.

Further, setting career goals should be done according to time intervals covering medium to long
term.
For instance, an employee can set career goals for two years, five years and ten years.

With time, these career goals may be subjected to change based on to what extent the employee
had achieved the planned objectives.

An individual may change job roles and organization along the career; however, career planning
should be done continuously.

In brief, career planning is a managerial technique for mapping out the entire career of
employees

from the employment stage to the retirement stage. It involves discovery, development, planned

employment and reemployment.

 OBJECTIVES : Career planning seeks to meet the following objectives:

i. Attract and retain talent by offering careers, not jobs.School of Distance Education

ii. Use human resources effectively and achieve greater productivity.

iii. Reduce employee turnover.

iv. Improve employee morale and motivation.

v. Meet the immediate and future human resource needs of the organization on a timely basis

 CAREER PLANNING IS NEEDED FOR THE FOLLOWING REASONS:

1. Provides career goals and paths

Career planning is needed to provide career goals and career paths to an employee.

It provides clear future directions in terms of career.

2. Develop competencies

Career planning motivates and encourages an employee to develop competencies for higher level

jobs. The competencies can be conceptual, interpersonal and technical.

3. Creativity

Career planning is needed to increase employee creativity.

It is needed for innovation in organization.

It can be lead to entrepreneurship within the organization.

4. Employee retention

Career planning is needed for retention of qualified employees in the long-term.

This is needed to decrease costs of recruitment, selection and training.

5. Motivation

Career planning motivates employees for higher performance.

Upward movement in organization is based on the quality and quantity of performance.

 NEED FOR CAREER PLANNING

The need for career planning is felt to :

(i) Attract competent person and retain them in the organisation.

(ii) Provide suitable promotional opportunites.

(iii) Map out careers of employees suitable to their ability, and their willingness to be trained and

developed for higher positions.

(iv) Ensure better utilization of managerial reserves within an organisation.

(v) Reduce employee dissatisfaction and turnover.

(vi) Improve employee morale and motivation by matching their skills to job requirements.

(vii) Provide guidance and encouragement employees need to fulfil their potentials.

(viii) Achieve higher productivity and organisation development.

 CAREER PLANNING PROCESS:

Analysing Employee Needs and Aspirations

Analysing Career Opportunities

Identifying Congruence and Incongruence

Action Plans and Periodic Review

 CAREER PLANNING: Career planning policy is an important for the

growth. It may be increases knowledge, skills and widespread increase in job
opportunities.
It may be creates and maintains sound relationship between employer and employee.

The process of career planning and development is as follows-

1. Identify and analysis of potential, individual skills, knowledge, abilities, aptitudes, new ideas, strategy.

2. Analysis of career opportunities both within and outside the organization.

3. Analysis of career demands on the incumbent in terms of skills, knowledge, abilities, aptitude etc. and

in terms of qualifications, experience and training received etc.

4. Relating specific jobs to different career opportunities.

5. Establishing short-term and long-term realistic goals and targets.

6. Formulating career strategy covering areas of change adjustment.

7. Preparing and implementing action plan including acquiring resources for achieving goals.

QUE NO 15: WHAT IS SUCCESSION PLANNING?

Succession planning is the process by which an organization identifies and develops new
employees to take up key leadership roles when the existing leaders leave for a different career,
retire or die.

This is essential for all types of organizations, irrespective of their size, in order to ensure that
organizational objectives are achieved and a smooth flow of operations are achieved.

Succession planning is usually done by senior management of a company where they

continuously receive information about well performing employees from line managers.

Succession planning cannot be done overnight since the skills and capabilities required to
perform a leadership role take a time to develop.

Succession planning has a number of benefits to both the employee and the employer.

From the employee’s perspective, this leads to higher motivation since the employee knows the
benefits awaits him or her as a future leader in the company.

This in turn will result in increased motivation backed by the ability to learn more and perform
better.

It also reinforces the employee’s desire for career development and career opportunities.

From the viewpoint of the employer, the progression towards the achievement of organizational
goals is not hindered or delayed as a result of a key leadership role becoming vacant.

There is no need to hire a new employee externally within a short period of time, which may be
costly and carry out induction.

According to Biswajeet Pattanayak, the succession planning involves the following core
activities

(i) Analysis of the demand for executives, managers and professionals by level, function & skill.

(ii) Audit of existing executives and inventory of likely future supply from both internal and

external sources.
(iii) Planning individual career paths based on objective estimates of future needs and drawing on

reliable appraisal and assessment of potential.

(iv) Undertaking career counselling in the context of future requirements for executives &

managers.

(v) Accelerated promotion schemes with development targeted against the future needs of the

organisation.

(vi) Training and development activities to groom people for future roles.

(vii) Planned recruitment to fill short-term vacancies and provide people for development to meet

future needs.

(viii) The actual process by which jobs are filled includes recruitment procedure, internal

appointment procedure, methods of assessment, internal search mechanism and often, use of

computer-based information systems.

 WHAT IS THE DIFFERENCE BETWEEN CAREER PLANNING AND SUCCESSION PLANNING?

Career Planning vs Succession Planning

Career planning is an ongoing process where an employee explores his or her interests and
capabilities and purposefully plan career goals.

Succession planning is the process by which an organization identifies and develops new
employees to take up key leadership roles when the existing leaders leave for a different career,
retire or die.

Nature

Career planning is conducted from the point of the employee.

Succession planning is conducted from the point of the organization.

Scope
In career planning, one employee will perform various roles over a period of time.

In succession planning, one role will be performed by a number of employees over a period of
time.

Unit V - Strategy of quality management: Job change: Promotion: Meaning – Purpose -

Types – Demotion – Transfer - Separation – Strategy of quality management: Six Sigma –
Kaizen – TQM – TPM – QMS - 5S - ISO Systems - ISO Certification Schemes - ISO types:
ISO 9001 – 14001 - ISO/TS 16949 – Preparing an Organization for ISO Certification - Quality
assurance: Mckinesey’s 7s frame work, HR out sourcing – PCMM.

QUE : STRATEGY OF QUALITY MANAGEMENT :- JOB CHANGE

Changes in duties and responsibilities of a position may result in a change of classification

and/or

grade level.

In this case, the incumbent employee can experience a job change without changing position.

Please bear in mind that more work does not result in change of classification or grade level.

It will likely result in overtime. Of course, overtime is not compensable for exempt employees.

A change in tools and methods is also unlikely to change classification or grade level.

The change of job can take place in different forms. They are:

PROMOTION

The employees are given the promotions to higher posts and positions as and when vacancies are

available or when new posts are created at the higher levels.

It is quite common in all types of organizations. It is the product of internal mobility of the

employees due to change in organizational processes, structure etc.

It is better than direct recruitment which satisfies many human resources problems of the

organization and helps in achieving organizational objectives.

Promotion means higher position to an employee who carries higher status, more responsibilities
and higher salary.

Higher status and salary is the two most important ingredient of any promotion.

It is an advancement of employee to a higher post with greater responsibilities and higher salary,

better service conditions and thus higher status.

TRANSFER

One of the internal mobility of the employee is transfer. It is lateral movement of employee in an

organization by the employee.

“A transfer involves the shifting of an employee from one job to another without changing the

responsibilities or compensation”.

Transfers of employees are quite common in all organizations.

This can also be defined as a change in job within the organization where the new job is

substantially equal to the old in terms of pay, status and responsibilities.

Transfers of employees can possible from one department to another from one plant to another.

Transfer may be initiated by the organization or by the employees with the approval of the
organization.

It can be also due to changes in organizational structure or change in volume of work, it is also
necessary due to variety of reasons.

 TYPES OF TRANSFERS most of the transfers generally carried out four types of transfers

which are discussed below:

PRODUCTION TRANSFER: Such transfers are resorted to when there is a need of manpower

in one department and surplus manpower in other department.

Such transfers are made to meet the company requirements. The surplus employees in one

department/section might be observed in other place where there is a requirement.

REPLACEMENT TRANSFERS: This takes place to replace a new employee who has been in
the organization for a long time and thereby giving some relief to an old employee from the
heavy

pressure of work.

REMEDIAL TRANSFERS: As the name suggest, these transfers are made to rectify the
situation

caused by faulty selection and placement procedures.

Such transfers are made to rectify mistakes in placement and recruitments.

If the initial placement of an individual is faulty or has not adjusted to work/job, his transfer to a

more appropriate job is desirable.

VERSATILITY TRANSFER: Such transfers are made to increase versatility of the employees

from one job to another and one department to another department.

Transfer (Job Rotation) is the tool to train the employees. Each employee should provide a varied

and broader job experiences by moving from one department to another.

This is for preparing the employee for promotion; this will definitely help the employee to have

job enrichment.

DEMOTION

Demotion is just the opposite of promotion. It is a downward movement of an employee in the

organizational hierarchy with lower status and lower salary.

It is a downgrading process and is insulting to an employee. Demotion is a punishment for

incompetence or mistakes of serious nature on the part of an employee.

It is a serious type of penalty or punishment and should be given rarely and only under
exceptional

circumstances and also tactfully.

MEANING OF SEPARATION:
Separation of an employee exists when the service of an employee comes to an end because of
one

reason or other. Separation arises due to resignation; lay off, dismissal and retirement.

TYPES OF SEPARATION

I) RESIGNATION: when the employee himself initiates the separation then it is termed as

separation. There are some resignation which are avoidable and others which are unavoidable.

It is the responsibility of the management to look out the real reason of the resignation.

In such a cases the exit interview is better to conduct to find out the reason of resignation.

II) LAY OFF: lay off is generally done to reduce the financial burden of the organization by

temporary removing the surplus employees.

This is done due to inability of the employee to recruit them due to shortage of sufficient
resources.

Lay off results in a great loss to the organization as they had to suffer all the expenses of
selection, placement and training.

III) DISMISSAL: dismissal or discharge means separating the employee from the payroll due to
unsatisfactory performance where the employee fails to perform his duties well and he is not
properly skilled to perform his job or due to violation of organizational rules it means
indiscipline, dishonesty.

Whatever is the cause of dismissal but it should be done at the last stage.

IV) RETIREMENT: number of separation in the organization happen due to retirement.

There must be clear rules of retirement there may be compulsory retirement where an employee
has to retire after attaining a particular age.

Forced retirement means when a person is found guilty in the court oflaw or breaks any service
agreement then has to retire forcibly irrespective of his age.

Premature retirement means that the employee becomes disable to perform the job in that case he
may be given the option to take retirement before his retirement age.
 JOB CHANGE

Job change means systematically moving workers from one job to another. It can help the person
develop a more realistic picture of what he or she is (and is not) good at, and thus the sort of
future career moves that might be best.

Job change means moving management trainees from department to department to broaden their
understanding of all parts of the business and to test their abilities.

The trainee – often a recent college graduate – may spend several months in each department.

The person may just be an observer in each department, but more commonly gets fully involved

in its operations. The trainee thus learns the department’s business by actually doing it, while
discovering what jobs he or she prefers.

There are several ways to improve a rotation program’s success. It should be tailored to the
needs, interests and capabilities of the individual trainee, and not be a standard sequence that all
trainees take.

How fast the person is learning should determine the length of time the trainee stays in a job.

The manager to whom he reports should assess and mentor the person in a competent way.

 PROMOTIONS – DEFINITION:

“Promotion is a term which covers a change and calls for greater responsibilities, and usually
involves higher pay and better terms and conditions of service and, therefore, a higher status or
rank.”

“A promotion is the transfer of an employee to a job which pays more money or one that carries
some preferred status”. - Scott & Clothier.

PURPOSE OF PROMOTIONS:

 To put the worker in a position where he will be of greater value to the company and where

he may derive increased personal satisfaction and income.

 To recognize an individual’s performance.

 To increase an employee’s organisational effectiveness.

 To build up morale, loyalty and sense of belonging on the part of the employees.
 To promote job satisfaction among the employees.

 To attract suitable and competent workers for the organisation.

TYPES OF PROMOTIONS:  Multiple Chain Promotions:

It provides for a systematic linking of each position to several others. Such promotions

identify multi-promotional opportunities through clearly defined avenues of approach to and exit

from each position in the organisation.

 Up or Out Promotions:

A person must either earn a promotion or seek employment elsewhere.

 Dry Promotions:

They are given in lieu of increases in compensation i.e., when all compensation is adjusted

upward to keep pace with the cost of living we have dry promotion.

All promotions should be on a trial basis (from 6 months to one year) for if the promoted

person is not found capable of handling his job, he may be reverted to his former post and former

pay scale.

DEMOTION – DEFINITION:

“The assignment of an individual to a job of lower rank and pay usually involving lower level of
difficulty and responsibility”.

“The lowering down of the status, salary and responsibilities of an employee”.

CAUSES OF DEMOTION:

 When departments are combined and jobs eliminated, employees are often required to accept

lower-level position until normalcy is restored.

 Inadequacy on the part of the employees in terms of job performance, attitude and capability.

 When an employee is not able to do his job properly because of changes in technology,
methods and practices, ill health or personal reasons.

 Demotion is also used as a disciplinary measure.

TRANSFER – DEFINITION:

“A lateral shift causing movement of individuals from one position to another usually without
involving any marked change in duties, responsibilities, skills needed or compensation”.

“A transfer is a horizontal or lateral movement of an employee from one job, section, department
or position to another at the same or another place where his status, responsibility and salary are
the same”.

PURPOSE OF TRANSFER:

 To meet an employee’s own request. (Personal Transfer)

 To utilize properly the services of an employee when he is not performing satisfactorily.

 To increase the versatility of the employee (Versatility Transfer).

 To adjust the workforce of one plant with that of another (Plant Transfer).

 To replace a new employee by an employee who has been in the organisation for a sufficiently

long time (Replacement Transfer).

 To help employees work according to their convenience so far as timings are concerned

 To penalize the employee transfers are also done.

SEPARATION – DEFINITION:

“The cessation of service with the organisation for one reason or the other. The employee may be

separated from the pay roll of a company as a result of: a) Resignation b) Discharge and
Dismissal

c) Suspension and Retrenchment d) Lay-off”.

A) RESIGNATION:

Resignations may be put in voluntarily by the employees on the ground of health, better
opportunities elsewhere; or they may be compulsory when an employee is asked to put in his
resignation if he wants to avoid termination of his services on the ground of gross negligence of
duty on his part, or some serious charge against him.

B) DISCHARGE & DISMISSAL:

A discharge involves permanent separation of an employee from the pay-roll for violation of
company rules or for inadequate performance.

A discharge becomes necessary:

i) When the volume of business does not justify the continuing employment of the persons

involved.

ii) When a person fails to work according to the requirements of the job.

iii) When an individual forfeits his right to a job because of his violation like safety, etc..

A dismissal is the termination of the services of an employee by way of punishment for some
misconduct, or for unauthorized and prolonged absence from duty.

C) SUSPENSION & RETRENCHMENT:

Suspension is a serious punishment and is generally awarded only after a proper enquiry has
been conducted. During suspension, the employee receives a subsistence allowance.

Retrenchment means a permanent termination of the services of an employee for economic

reasons in a going concern.

However, on retrenchment, an employee is entitled to both retrenchment compensation and

gratuity.

D) LAY-OFF:

A lay-off refers to an indefinite separation of the employee from the pay-roll due to factors
beyond the control of the employer; the employee is expected to be calling back in the
foreseeable future.

The factors, which are beyond the control of the employers are:

i) Breakdown of machinery.

ii) Seasonal fluctuations in markets and loss of sales.

iii) Accumulation of stocks or financial slump.

iv) Shortage of raw material, coal and power.

v) Production delays and

vi) Other technological reasons.

A laid-off worker is paid 50% of his basic wages and dearness allowance for every working

day on which he reports for work.

 IMPLICATIONS OF JOB CHANGE:

Job change means systematically moving the employees from one job to another. It can help the

person to develop more realistic of what he is and thus the sort of future career will be the best.

Change: It can be proactive or reactive.

Proactive: This is the change which is planned and an attempt is made to prepare for anticipated

future challenges.

Reactive: A reactive change may be an automatic process or a planned response to change

which is taking place in the environment.

TYPES OF CHANGES:

1. WORK CHANGE:

It includes changes in working hours, methods or work, job enlargement and job enrichment.

2. ORGANISATIONAL CHANGE: It includes changes in employees due to transfers,

promotions, layoff, introduction of new products and services.

RESISTANCE TO CHANGE:

1. Economic reason:
a. Fear of reduction in employment, b. Fear of workload , c. Fear of demotion.

2. PERSONAL REASON

a. Need for training, b. Boredom and monotony, c. No participation in change

3. Social reason.

a. Need for new social adjustments.

 PROMOTION

Promotion is vertical movement of an employee within the organisation. In other words,

promotion

refers to the upward movement of an employee from one job to another higher one, with increase

in salary, status and responsibilities.

Promotion may be temporary or permanent, depending upon the needs of the organisation.

There can be ‘dry promotion’ also where an employee is assigned to a higher level job without
increase in pay.

An example of ‘dry promotion’ is a University Professor made Head of the Department with no
increase in salary.

Promotion has an in-built motivational value as it elevates the authority, power and status of an
employee within an organisation.

It is considered good personnel policy to fill vacancies in a higher job through promotions from

within because such promotions provide an inducement and motivation to the employees and
also

remove feelings of stagnation and frustration.

TYPES OF PROMOTION

Promotion given to employees in an organisation can be classified into three types:

1. HORIZONTAL PROMOTION: When an employee is shifted in the same category, it is

called ‘horizontal promotion’. A junior clerk promoted to senior clerk is such an example. It is
important to note that such promotion may take place when an employee shifts within the same
department, from one department to other or from one plant to another plant.

2. VERTICAL PROMOTION: This is the kind of promotion when an employee is promoted

from a lower category to higher category involving increase in salary, status, authority and
responsibility. Generally, promotion means ‘vertical promotion’.

3. DRY PROMOTION: When promotion is made without increase in salary, it is called ‘dry
promotion’. For example, a lower level manager is promoted to senior level manager without
increase in salary or pay.

Such promotion is made either there is resource/fund crunch in the organisation or some
employees hanker more for status or authority than money.

 PURPOSES

The following are the purposes or objectives of promotion:

1. To recognize an employees skill and knowledge and utilize it to improve the org effectiveness.

2. To reward and motivate employees to higher productivity.

3. To develop competitive spirit and inculcate the zeal in the employees to acquire skill,

knowledge etc.

4. To promote employees satisfaction and boost their morale.

5. To build loyalty among the employees toward organisation.

6. To promote good human relations.

7. To increase sense of belongingness.

8. To retain skilled and talented people.

9. To attract trained, competent and hard working people.

10. To impress the other employees that opportunities are available to them too if they also

perform well.

TRANFER : According to Flippo , “a transfer is a change in the job (accompanied by a change

in
the place of the job) of an employee without a change in responsibilities or remuneration”.
Transfer

differs from promotion in the sense that the latter involves a change of job involving increase in

salary, authority, status and responsibility, while all these remain unchanged/stagnant in the case

of former. Also, transfers are frequent and regular whereas promotions are infrequent, if not

irregular.

 NEED - The need for making transfer is left for various reasons as listed below:

1. TO MEET ORGANISATIONAL NEEDS: Changes in technology, volume of production,

production schedule, product line, quality of products, organisational structure, etc. necessitate
an organisation to reassign jobs among employees so that right employee is placed on the right
job.

2. TO SATISFY EMPLOYEE NEEDS: Employees may request for transfer in order to satisfy
their desire to work in a particular department, place and under some superiour.

Personal problems of employee like health, family circumstances, interpersonal conflicts may
also necessitate transfer.

3. TO BETTER UTILIZE EMPLOYEE: When an employee is not performing satisfactorily

on one job and management thinks that his/her capabilities would be utilized better elsewhere,
he/she may be transferred to other job.

4. TO MAKE THE EMPLOYEE MORE VERSATILE: In some organisations like banks,

employees after working on a job for a specified period are transferred to other job with a view
to widen their knowledge and skill and also reduce monotony. This is also called ‘job rotation’.

5. TO ADJUST THE WORKFORCE: Work force can be transferred from the departments /
plants where there is less work to the departments/plants where is more work.

6. TO PROVIDE RELIEF: Transfers may be made to give relief to the employees who are
overburdened or doing hazardous work for long period.

7. TO PUNISH EMPLOYEE: Management may use transfer as an instrument to penalize

employees who are indulged in undesirable activities. As a disciplinary action, employees are
transferred to remote and far-flung areas.

 TYPES Employee transfers may be classified into following types:

1. Production Transfer: Such transfers are made when labour requirements in one division or

branch is declinning. The surplus employees from such division are transferred to those divisions

or branches where there is shortage of employees. Such transfers help avoid lay off and stabilize

employment.

2. Remedial Transfer: Such transfers are affected to correct the wrong selection and placement

of employees. A wrongly placed employee is transferred to more suitable job. Such transfers

protect the interest of the employee.

3. Replacement Transfer: Replacement transfers are similar to production transfers in their

inherent, i.e. to avoid layoffs.

Replacement transfers are affected when labour requirements are declining and are designed to

replace a new employee by an employee who has been in the organisation for a sufficiently long
time.

The purpose of these transfers is to retain long service employees in the organisation and also
give them some relief from the heavy pressure of work.

4. Versatility Transfer: These transfers are also known as ‘job rotation? In such transfers,

employees are made move from one job to another to gain varied and broader experience of
work.

It benefits both the employee and organisation. It reduces boredom and monotony and gives job
enrichment to the employee.

Also, employees’ versatility can be utilized by the organisation as and when needed.

5. Shift Transfers: These transfers are affected in the organisations where work progresses for

24 hours or in shifts. Employees are transferred from one shift to another usually on the basis of

mutual understanding and convenience.Internal Mobility and Separations

6. Penal Transfer: Management may use transfer as an instrument to penalize employees

involved in undesirable activities in the organisation. Employee transfer from one’s place of
convenience to a far-flung and remote area is considered as a penalty to the employee.

 DEMOTION

Demotion is just the opposite of promotion. It is the downward movement of an employee in the

organisational hierarchy with lower rank/status and pay.

According to D.S. Beach, “Demotion is the assignment of an individual to a job of lower rank
and

pay usually involving lower level of difficulty and responsibility”.

Demotion affects the status, pride, career and income of the employee. Research studies

report that an employee who is demoted suffers from more severe jolt than it does when a junior

employee supersedes him/her.

It is used as a punitive measure in case of serious breaches of duty on the part of an employee.

It is often a preliminary to a dismissal. Since demotion causes an insult and emotional jolts, it
should be, therefore, used very tactfully and only in case of absolute necessity.

 13.3.1 CAUSES

Demotion may be caused by several factors which may be beyond an employee’s control.

Following are the important ones:

1. Incompetence: When a promotee is found unable to meet the challenges posed by the new

higher job, he may be demoted to jobs suitable to him to correct errors in promotion.

It often happens in organisations that employees promoted on the basis of seniority and past
experience are unable to adjust and cope with changes in technology, methods and practices.

In other words, such promotees cannot meet the raised expectations substantially.

2. Adverse Business Conditions: At times, circumstances and conditions like recession and

other crisis may necessitate a business to combine departments and eliminate jobs.
In fact, this feature is very much in sight and is on increasing also. In case of lay-offs and
bumping process, junior employees may be retrenched and senior employees may be required to
accept lower level jobs,until normalcy is restored.

However, such a demotion is not a black mark against an employee.

3. Disciplinary Measures: Demotion is also used as a disciplinary measure against erring

employees. It is a penalty imposed on employee for violation of company rules of conduct.

Since demotion affects employee job satisfaction and morale, it should be used with a pinch of
care and concern and that too when it is absolutely necessary.

In order to use demotion properly, there must be an appropriate demotion policy.

 SEPARATIONS

As studied in the previous section, the function of human resource management starts with

procuring employees from the society for their use in the organization.

Hence, it stands logical to return those employees to the same society when they are no more
required in the organisation.

In this section, we shall review the prominent processes of separation.

Separation is a situation when the service agreement of an employee with his/her organisation
comes to an end and employee leaves the organisation.

In other words, separation is a decision that the individual and organisation part from each other.

In practice, employees may be separated, or say, may move out of organisation for a variety of
reasons like retirement, resignation, suspension, discharge, dismissal and layoff.

Be whatever the types/forms of separation, separation becomes important and sometimes

traumatic event for both the employee and organization

 DEFINITIONS OF PROMOTION
According to Scott and Clothier, ―A promotion is the transfer of an employee to a job which
pays more money or one that carries some preferred status.
According to Prof Mamoria, ―Promotion is a term which covers a change and calls for greater
responsibilities, and usually involves higher pay and better terms and conditions of service and,
therefore, a higher status or rank.

According to Arun Monappa and Saiyadain, ―Promotion is the upward reassignment of an

individual in an organization‘s hierarchy, accompanied by increased responsibilities, enhanced
status, and usually with increased income, though not always so.‖

BASIS OF PROMOTION
(a) Promotion Based on Seniority
(b) Promotion Based on Merit
(c) Merit cum seniority promotion
(d) Promotion by Selection
(e) Time Bound Promotion

TYPES OF PROMOTION : The different types of promotions are:

(a) Limited Promotion

Limited promotion is also known as upgrading. It is the movement of an employee to a more
responsible job within the same occupational unit and with a corresponding increase in pay. Thus,
upgrading means an increase of pay on the same job or moving to a higher scale without
changing the job.
(b) Dry Promotion
Dry promotion is a promotion as a result of which there is no increase in the employee‘s pay.
Dry promotions are those which are given in lieu of increases in compensation. It is usually
made decorative by giving a new and longer title to the employee.
(c) Multiple Chain Promotion
Multiple chain promotion provide for a systematic linking of each position to several other
positions. Such promotions identify multi-promotional opportunities through clearly defined
avenues of approach to and exist from each position in the organization.
(d) Up and Out Promotion
Up and Out Promotion often leads to termination of services. In this type of promotion, a person
must either earn a promotion or seek employment elsewhere.

 DEMOTION is a process by which the employee is downgraded and sent to a lower position
from the one he is holding at present. When an employee is moved to a job with less
responsibility, status or compensation he is said to be demoted.
Demotion is the reverse of promotion. It is more a punishment for inefficiency or incompetence.

According to D.S Beach, Demotion is ―the assignment of an individual to a job of lower rank
and pay usually involving lower level of difficulty and responsibility.

According to Arum Moapa and Saiyadain Demotion ―is a downward assignment in the
organization‘s hierarchy to a lower level job which has less responsibility, pay and status.
Because of this hierarchical repositioning it has a negative connotation and may lead to
employee dissatisfaction‖.
Demotions, being a serious penalty, must be handled tactfully. The usefulness of demotion as a
punitive measure is questioned on many grounds.
A demoted employee will be disgruntled and his dissatisfaction may spread to co-workers which
will adversely affect morale, productivity and discipline of the workforce.

CAUSES OF DEMOTION
 Demotion may be used as a disciplinary weapon. Demotion may be resorted to when
employees, because of ill health or personal reasons, cannot do their job properly.
 If a company curtails some of its activities, employees are often required to accept lower-level
position until normally is restored.
 If an employee finds it difficult to meet job requirement standards, following his promotion

 TRANSFER

A transfer is a change in job assignment. It does not involve a change in responsibility and status.

A movement of an employee between equivalent positions at periodical intervals is called

transfer.
A transfer therefore does not involve a change of responsibility or compensation.

Transfers are normally made to place employees in positions where they are likely to be more
effective or where they are likely to get greater job satisfaction.

Transfers may be either organization-initiated or employee- initiated. An organization may

initiate a transfer place employees in positions where they are likely to be more effective or
where they are better able to meet work schedules of the organization.

Employee initiated transfers also known as ―personnel transfers‖ may be initiated for
several reasons. These could range from wanting a change of boss or a change of location or to
avoid interpersonal conflicts with their present colleagues or to join their friends and relatives.

TYPES OF TRANSFERS

There are different types of transfers depending on the purpose for which the transfers are made.

Judging from the view-point of purpose, there are nine type of transfers.

(a) General (b) Production (c) Replacement (d) Shift (e) Remedial (f) Versatility (g) Punishment
or Penal (h) Request or Personal (i) Mutual

a) General : General transfers are normally affected during a particular period of the year
wherein all employees having completed a given period of service in a post or at a place are
involved.

Definite rules and regulations are to be followed in affecting such transfers. Such transfers are
followed in big organizations, quasi-governmental organizations and government departments.

(b) Production :Production transfers are normally made from one department to another where
the need for the employee is more. This type of transfer is made to avoid lay-off of efficient and
trained employees by providing them with alternative positions in the same organization.

These changes help to stabilise employment in an organization and therefore require centralised
control.

Although it is called production transfer, similar situations can exist in non- manufacturing
enterprises or divisions too where an employee is transferred from one department to another for
similar reasons

(c) Replacement : These are transfers of long-service employees to similar jobs in other
departments where they replace or ‗bump‘ employees with shorter service.
Replacement transfers are affected to replace persons leaving the organization, due to
resignations, retirements, dismissal or death.

Quite often such transfers are affected to change a new employee who has proved to be
ineffective in the organization.

Even though the objective of these transfers is to retain the efficient and trained employees in
this process some short-service employees may lose their jobs.

d) Shift : Shift transfers are transfers of workers from one shift to another on the same type of
work. Workers generally dislike second or third shift as it affects their participation in
community life. To minimise this, shift transfers are effected. Shift transfers also help workers to
be out of routine fatigue.

(e) Remedial

Remedial transfers are transfers made to remedy some situation primarily concerned with
employee on the job.

Remedial transfers provide management with a procedure whereby an unsatisfactory placement

can be corrected.

Initial placement might be faulty or the type of job might not suit his health in such cases the
worker would benefit by transfer to a different kind of work.

(f) Versatility

The objective of these transfers is to increase the versatility of the employee by shifting him from

one job to another.

In this way, the employee is provided a varied and broad job experience. This transfer is like a
rotation transfers. Versatility transfers, besides resulting in greater satisfaction of the workers
through job enlargement, also creates a work force which can be conveniently shifted to other
jobs in time of necessity.

(g) Punishment or Penal

This transfer is made as punishments to erring employees. Quite often the employees are
transferred from one place be another so that they are made to work in a situation of risks and
hazards.

Employees are posted to such places as a matter of punishment for the errors and omissions they
have committed.

Sometimes, transfer is used as a concealed penalty. A trouble-maker may be transferred to a

remote

branch where he cannot continue his activities.

(h) Request Transfers

This type of transfer is done on the request of the employee. It is normally done on humanitarian

grounds to help the employee to look after his family and personal problems.

(i) Mutual Transfers

When transfers turn out to be mutual between two employees they are refered to as mutual

transfers. Usually the organization concedes to request of employees for transfer if another

employee is willing to go to the other place.

SEPARATION

Separation means cessation of service of agreement with the organization. Separation can be the

result of: (a) Resignation (b) Discharge (c) Dismissal(d) Retrenchment (e) Lay-off (f) Golden

handshake (g) Retirement

(a) Resignation

A resignation is a voluntary separation. When a termination is initiated by the employee himself,

it is termed a resignation. Resignations may be put in voluntarily by the employees on grounds of

marriage especially in case of young girls, health, physical disability, better opportunities

elsewhere, or maladjustment with company policy and affairs.

The personnel department should investigate the real reasons behind such resignations. A study
of

exit interviews over a period of time may disclose a fiscal pattern suggesting improvements in
the

personnel management functions.

Resignation may also be compulsory when an employee is asked to put in his papers if he wants

to avoid termination of services on the ground of gross negligence of duty or some serious
charge

against him.

(b) Discharge

A discharge involves permanent separation of an employee from the organization because of

poor

performance, violation of rules or poor code of conduct. A discharge becomes necessary when

(i) The business volume is reduced thereby reducing the employment opportunities in the org

(ii) The employee fails to work according to the requirements of the job, or

(iii) The employee forfeits his right to a job.

Discharges are generally made in accordance with the standing orders. The action taken should
be

bonafide and nor a punitive measure or a case of victimisation.

(C) DISMISSAL

When the termination is initiated by the organization, it is termed as dismissal. A dismissal is the
termination of the services of an employee by way of punishment for some misconduct, or for
prolonged absence from duty.

A dismissal is a drastic step. Therefore, it must be supported with a just and sufficient cause.

It is generally done as a last resort after all attempts at reconciliation have failed.
Before an employee‘s services are terminated, he should be given an opportunity to explain his
conduct and show cause why he should not be dismissed.

The principle of natural justice should be followed to ensure that the punishment is in proportion
to the offence. As a safeguard, responsibility for dismissal should not rest on the immediate
supervisor.

The approval of the next higher authority should generally be taken and the personnel manager
should be consulted. Dismissals can be on the ground of unsatisfactory performance, misconduct,
or want qualifications for the job, or excessive absenteeism.

(d) Retrenchment

Retrenchment is termination of service due to redundancy. It is a permanent termination of the

services of an employee for economic reasons in a going concern.

It must be noted that termination of services as a punishment given by way of disciplinary action
or superannuation or continued ill health does not constitute retrenchment.

The term retrenchment is applied to continuing operations where a part of the workforce is found
to be superfluous. Retrenchment has many unstabilising effects.

It influences the attitudes and contributions of other employees who become disturbed by
rumours, gossips, resentment and a sense of insecurity about their own fate.

The principle in the procedure of retrenchment is that the last person employed in each category
must be the first person to be retrenched.

For this purpose, the employer prepares a list of all the workers in the category where
retrenchment is contemplated, arranged according to the seniority of service of the employees in
that category.

When vacancies arise after retrenchment, the organization gives an opportunity to the retrenched
workers to offer themselves for re-employment; and they are given preference.

(e) Layoff

According to Section 2 (KKK) of the Industrial Disputes Act, a layoff is ―the failure, refusal or
inability of an employer, on account of shortage of coal power or raw materials, or the
accumulations of stocks or breakdown of machinery for any reason, to give employment to a
workman whose name is borne on the muster roll of his individual establishment and who has not
been retrenched‖.
According to this definition, a lay off refers to an indefinite separation of the employee from the
pay roll due to factors beyond the control of the employer. The employee is expected to be called
back in the forseeable future. The laid-off employee is not a discharged employee and is still
carried on the roll as an employee.

Lay- off is resorted to by the employer for factors beyond his control. Such factors could be:

 Fluctuations in the market resulting in loss of sales.

 Shortage of raw materials or power.

 Accumulation of stock.

 Breakdown of machinery.

 Production delays.

f) Golden Handshake

It is a method of retrenchment wherein the employees with a certain minimum service can opt
for voluntary retirement and get a fat lumpsum in return.

Golden handshake is usually offered by the Government to reduce the size of the bureaucracy
and close down chronically loss-making public sector enterprises.

Many thinkers on the subject are of the opinion that golden handshake is the fallout of the new
economic policy followed by the Government of India.

In the 1992–93 Union Budget, the Government had provided Rs. 450 crores for the Voluntary
Retirement Scheme (VRS) for its employees.

(g) Retirement

In India, the retirement age is 58 or 60 years. Some employers may extend the age upward or

downward from this base.

For those employees who retire, it is a significant milestone. Regardless of the age at which
retirement occurs, workers may need preparation through counselling.

They should be informed about pension choices and insurance benefits after retirement.
Employees at retiring age often feel they could continue to work effectively and there is a strong
resistance from many to give up employment. For an organization, in times of staff shortage,
retired employees

QUE: Strategy Of Quality Management: Six Sigma – Kaizen – TQM – TPM – QMS - 5S

WHAT IS KAIZEN?

Kaizen is a Japanese word that means "change for the better," though the process is also
referred to as "continuous improvement." The Kaizen philosophy was first introduced to
Westerners in 1986 by Masaaki Imai, who explained that Kaizen means everything can be
improved and made to be better or perform more efficiently. In order to do this, the process
aims to identify the three "Mu's:" Muda (meaning wastes), Mura (meaning variations and
inconsistencies) and Muri (meaning strains and burdens placed on people and machines).

The guiding principles of Kaizen include:

 Good processes are required to bring good results

 Go see for yourself to understand the current situation
 Manage by facts and speak with data
 Take action to stop and fix the root causes of problems
 Work as a team when possible
 Kaizen isn't just for managers, but everyone

FIVE S OF KAIZEN
“Five S” of Kaizen is a systematic approach which leads to foolproof systems, standard policies,
rules and regulations to give rise to a healthy work culture at the organization. You would hardly
find an individual representing a Japanese company unhappy or dissatisfied. Japanese employees
never speak ill about their organization. Yes, the process of Kaizen plays an important role in
employee satisfaction and customer satisfaction through small continuous changes and
eliminating defects.
Kaizen tools give rise to a well organized workplace which results in better productivity and
yield better results. It also leads to employees who strongly feel attached towards the
organization.
Let us understand the five S in Detail:

1. SEIRI - SEIRI stands for Sort Out. According to Seiri, employees should sort out and
organize things well. Label the items as “Necessary”, ”Critical”, ”Most Important”, “Not
needed now”, “Useless and so on. Throw what all is useless. Keep aside what all is not
needed at the moment. Items which are critical and most important should be kept at a
safe place.
2. SEITION - Seition means to Organize. Research says that employees waste half of their
precious time searching for items and important documents. Every item should have its
own space and must be kept at its place only.
3. SEISO - The word “SEISO” means shine the workplace. The workplace ought to be kept
clean. De-clutter your workstation. Necessary documents should be kept in proper folders
and files. Use cabinets and drawers to store your items.
4. SEIKETSU-SEIKETSU refers to Standardization. Every organization needs to have
certain standard rules and set policies to ensure superior quality.
5. SHITSUKE or Self Discipline - Employees need to respect organization’s policies and
adhere to rules and regulations. Self discipline is essential. Do not attend office in casuals.
Follow work procedures and do not forget to carry your identity cards to work. It gives
you a sense of pride and respect for the organization.

What is Six Sigma?

Six Sigma is a set of tools and strategies that can limit defects and inconsistencies in a product
or service using hard data. This is done through two project methodologies:

 DMAIC: define, measure, analyze, improve and control

 DMADV: define, measure, analyze, design verify

Under both methodologies, the team should use statistical techniques in order to define
quantified value targets.

Six Sigma Tools

Six Sigma tools are problem-solving avenues used to support Six Sigma and other improvement
initiatives. They include:
5S System: This is a means of organizing the materials in the workplace, leading to quicker
access and more effective maintenance. The 5S system is excellent for waste management and
disposal within the work environment.
Value Stream Mapping: Value stream maps illustrate the flow of materials and information in
one of the processes. It helps with optimizing flow within companies.
Pareto Chart: The Pareto chart illustrates the differences between particular data groups allowing
the Six Sigma teams to point out the most significant threats against the process.
Regression Analysis: Regression analysis is a statistical approach, used to ascertain the negative
or positive relationships among several variables.
Kaizen: This is a practice of continual observation, identification, and implementing particular
improvements to the production process.

Six-Sigma Philosophy

Six-Sigma is primarily a management philosophy that attempts to improve upon customer

satisfaction to near perfection.

Six Sigma is the smarter way to manage a business or a department by managing with facts,
figures

and data. Herein, the overriding philosophy is ‘customer satisfaction’.

The objective of Six Sigma is to drive process improvements by focusing on defect elimination,

rather creating and improving products/services that results in a very small number of defects.

Six Sigma equals to 3.4 defects parts per million opportunities.

This says a six sigma company has little more than, 3 bad customer experience (3.4) for every

million opportunities.
As per Pande (2002) and Ecke (2001a) Six Sigma efforts target the main areas of improvement
as

given below:

1. Improves customer satisfaction

2. Reducing cycle time

3. Reducing defects

There are main five breakthrough strategies of Six Sigm philosophy (D-M-A-I-C) as under:

 D- Define : The goals of the improvement activity

 M-Measure: The existing system

 Analyse: The system to identify ways to eliminate the gap between the current

performance/process and

 I-Improve: the existing system

 C-Control: The new system